Elasticity of demand, Microeconomics

Assignment Help:

"Assume the local fixed telecommunications company is a monopoly. It costs the company €2 per month to give voice messages service to a customer. Elasticity of demand for voice messages service is 4/3 (at any price). Then the phone company will produce more money if it does offer its service at €5 per month than if it offers this service at €8 per month." Explain the statement in your own words.

 


Related Discussions:- Elasticity of demand

Elasticity, What are the uses of elasticity to the private sector

What are the uses of elasticity to the private sector

Mathematical representation-inflation unemployment trade-off, Mathematical ...

Mathematical representation - Inflation Unemployment Trade-off : Suppose that firms correctly perceive the state of demand in the economy and the rate of price inflation. The

Strong domestic economy and strengthening the patent system, Strong Domesti...

Strong Domestic Economy: We have to realise that healthy export sector can be built up only on a strong and efficient domestic economic structure. A sound domestic economy is

Low standards of living, Low standards of living: In developing natio...

Low standards of living: In developing nations general standards of living tend to be very low for the vast majority of the people. These low standards of living are manifest

Point elasicity, Q=10-2P,PRICE DECREASE FROM RS 3 TO 2

Q=10-2P,PRICE DECREASE FROM RS 3 TO 2

Concept of supply, #question.using a well illustrated diagram, explain the ...

#question.using a well illustrated diagram, explain the concept of producers equilibrium .

Explain costs and benefits of establishing a common currency, Discuss the c...

Discuss the costs and benefits of establishing a common currency. So, there is a convergence issue in setting up the common currency - and there will also be a convergence prob

What is the theory of Second Best?, What is the theory of Second Best? Prov...

What is the theory of Second Best? Prove the theorem with the help of a diagram.

Monopolist''s profit-to-revenue ratio, "Take a monopolist with a constant a...

"Take a monopolist with a constant average cost. The higher is the elasticity of demand at the chosen monopoly price, the higher is the monopolist's profit-to-revenue ratio." Expla

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd