Why might zenvox choose to produce at a price

Assignment Help Econometrics

Reference no: EM13189975

The Zenvox TV Company faces a demand function for its products that can be expressed as Q = 4,000 - P + 0.5i, where Q is the number of tv's, P is the price per tv, and i is the average monthly income. Average monthly income is currently equal to $2.000.

a. Graph the demand curve (sometimes called the "inverse" demand curve) face by Zenvox at the current income level. Be sure to label this and all graphs you draw carefully. On the same graph, depict marginal revenue. At what price and quantity is Zenvox's total revenue maximized? What is the marginal revenue at this point? Show calculations.

b. What is the price elasticity of Zenvox's demand function at the price and quantity depicted in part a? Explain what this value means in words.

c. Why might Zenvox choose to produce at a price and quantity different than that derived in part a?

Reference no: EM13189975

Questions Cloud

What is the annual savings over the other design : Consider two possible designs for a product which are sold for $0.70 each. There are only two differences in the production of both designs: operation 1 and operation 2. The first product, A, requires 16 hours of operation 1 and 4.5 hours of opera..

What should be the price of the ticket if the game is fair : A lottery offers one $1000 prize, one $500 prize, five $100 prizes, and ten $10 prizes. One thousand tickets are sold. What should be the price of the ticket if the game is fair?

Translate the phrase to an algebraic expression : Justin had $33 before spending b dollars on jeans. How much money remains?

Distinction between nature and custom : Your essay assignment is to compare Democritus and the Sophists (Protagoras and Gorgias) on the distinction between nature and custom (or law). In Philosophy Before Socrates, McKirihan does not include Democritus in his discussion of this distinction..

Why might zenvox choose to produce at a price : The Zenvox TV Company faces a demand function for its products that can be expressed as Q = 4,000 - P + 0.5i, where Q is the number of tv's, P is the price per tv, and i is the average monthly income. Average monthly income is currently equal to $..

Explain how many grams of liquid sodium : How many grams of liquid sodium (minimum) are needed to absorb 4.70 MJ of energy (in the form of heat) if the temperature of the sodium is not to increase by more than 10.0 °C?

State the reaction of chlorine with sodium hydroxide : Think about the reaction of (a) chlorine with sodium hydroxide and the reaction of (b) acetone with hypochlorite ion. Classify Each reaction as either:

How many people are in the room : Two-thirds of the people in a room are seated in three-fourths of the chairs. The rest of the people are standing. If there are 6 empty chairs, how many people are in the room?

What is the current macroeconomic situation in the us : What is the "current macroeconomic situation" in the U.S. (e.g. is the U.S. economy currently concerned about unemployment, inflation, recession, etc.) What fiscal policies and monetary policies would be appropriate at this time Can I please have ..

User Account

All Pages