What happens to total revenues from oranges due to freeze

Assignment Help Business Economics

Reference no: EM13838657

Suppose the demand for oranges in the U.S. is: P = 5.35 - .012 Q

Where Q is the quantity demanded for oranges in the U.S. (measured in millions of boxes per year) and P is the price per box.

Suppose the current price of oranges is $3 per box. A deep freeze comes through a wipes out part of the Florida orange crop, raising the price of oranges to $3.25 per box.

a) Using the midpoint formula, what is the elasticity of demand for oranges at $3 per box?

b) What happens to total revenues from oranges due to the freeze? Why?

Reference no: EM13838657

Questions Cloud

Blue book value of vehicle in used-car marketplace : A friend of yours just bought a new sports car with a $4,000 down payment, and her $25,000 car loan is financed at an interest rate of 0.25% per month for 48 months. After 2 years, the "Blue Book" value of her vehicle in the used-car marketplace is $..

According to tournament theory : According to tournament theory:

Is the demand for corn elastic or inelastic-why : Graph the demand curve on a standard supply and demand graph. What is the quantity demanded of corn at a price of $6.00 per bushel? at $4 per bushel? Using the midpoint formula for the price elasticity of demand, calculate the price elasticity of dem..

Governments often to raise revenues to fund public projects : Governments often need to raise revenues to fund public projects like schools, road maintenance, parks, etc. One way governments raise revenue is to place taxes on the sale of certain goods. Suppose a government is debating whether to raise taxes on ..

What happens to total revenues from oranges due to freeze : Suppose the demand for oranges in the U.S. is: P = 5.35 - .012 Q. Using the midpoint formula, what is the elasticity of demand for oranges at $3 per box? What happens to total revenues from oranges due to the freeze? Why?

What happens to employment and the wage in southern state : Suppose that after the wage goes up in the Northern state, workers lose their jobs in the North and decide to move to the Southern state. This increases the population there. Adjust the graph to show what happens to employment and the wage in this So..

Planning is critical for successful project management : Planning is critical for successful project management. Describe the various strategies you would use if you were responsible for managing the Webster University graduation ceremony in the spring.

What MARR does the investment represent : A college graduate with a B.S. in Mechanical Engineering expects to earn, on average, $20,000 per year more than an engineer without a B.S. degree. what MARR does the investment represent? Is it a high or low rate of return compared to, say a student..

Stackelberg and cournot competition : Apple put on the first smartphone, making them the Stackelberg leader. Samsung, HTC and Sony release their smartphones some time later. Consider the market competition game between these three companies. Characterize the output level for each firm an..

User Account

All Pages