The demand curve , Macroeconomics

Assignment Help:

A sporting goods store has estimated the demand curve for a popular brand of running shoes as a function of price. Use the diagram to answer the questions that follow.

2358_price per unit.png

a.   Calculate demand elasticity using the midpoint formula between points A and B, between points C and D, and between points E and F.

b.   If the store currently charges a price of $50, then increases that price to $60, what happens to total revenue from shoe sales (calculate P × Q before and after the price change)? Repeat the exercise for initial prices being decreased to $40 and $20, respectively.

c.   Explain why the answers to a. can be used to predict the answers to b.

 


Related Discussions:- The demand curve

Unemployment rate for each country, The following Table B presents the 2010...

The following Table B presents the 2010 population, employment, and unemployment data among working age persons for several countries. a. Calculate the number of people in the lab

Geometric gradient series, Determine the present worth of a geometric gradi...

Determine the present worth of a geometric gradient series with a cash flow of $50,000 in year 1 and increases of 6% each year through year 8. The interest rate is 10% per year.

Graph, Maximum profits will occur at the output level where is the greatest...

Maximum profits will occur at the output level where is the greatest vertical distance between Total Revenue(TR) AND Total Cost(TC. uSE THE TOTAL REVENUE-TOTAL COST CURVES TO Illus

How to find nominal gdp in the current year, Consider an economy that produ...

Consider an economy that produces only three types of fruit: apples, oranges & bananas. In the base year the production & price data are as follows: Fruit

Signs which indicate increament in the sales of the cilent, One of our clie...

One of our clients is a major homebuilder in the Midwest. This company believes that sales of their new homes are highly correlated with business cycles in the overall US economy.

Imputed values included in gdp, Imputed values included in GDP are the: ...

Imputed values included in GDP are the: A) market prices of goods and services. B) estimated value of goods and services that are not sold in the marketplace. C) price of

To compare prices what is consumers ability, How has the Internet revolutio...

How has the Internet revolution affected the workings of businesses, consumers, and government in a free market economy? Specifically, how has Internet affected businesses' ability

Substitute a less expensive good, If the price of a good rises, what are pe...

If the price of a good rises, what are people likely to do? a Substitute a less expensive good b Buy more of the good c Buy more of all goods because of added buying power d All of

Partial equilibrium and surplus, The city of Cabernet is very famous for it...

The city of Cabernet is very famous for its production of wine. The inhabitants of the city have an aggregate demand for wine that can be described as follows: D(p) = Q d =150-

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