You Are the Manager for Starbucks and Know the Following Elasticities:

The demand for adept X is estimated to be Q ten d = 10, 000 - 4P 10 + 5P Y + 2M + A X, where P Ten is the price of Ten, P Y is the cost of good Y, M is income and A X is the amount of ad on X. Suppose the present price of good Ten is $50, P Y = $100, M = $25,000, and A X = ane,000 units. Based on this information, the income elasticity of good X is
0.82.

The demand for answering machines is Q = 1,000 – 150 P + 25 I. Assume that per capita dispensable income I is $200. When the cost of answering machines is P = $10, the price elasticity of demand is:
–0.33

When the cost of sugar was "low", consumers in the U.S. spent a full of $iii billion annually on carbohydrate consumption. When the price doubled, consumer expenditures increased to $5 billion annually. This data indicates that:
The demand for sugar is inelastic.

"Colombia, Brazil Advance Proposal to Withhold 10 Percent of Export Output" ( Wall Street Journal, September 23, 1991, p. B6). A Colombian delegate to the International Coffee Organization said that if all its members withheld 10 percent of consign output, the international price would rise 20 percentage. This statement implies the price elasticity of demand for java is approximately:
-0.50

A manufacturer of infant apparel has constitute that the demand for its production is given by Q = 100 P –one.25 A 0.5, where P is price and A is advertizing expenditures. The price elasticity of demand for these infant clothes is:
–1.25

The formula for the income elasticity of need can be written as:

When marginal revenue is positive for a linear (inverse) need part, decreases in output will cause total revenues to
subtract.

The initial price for an item is $5.00, and the quantity demanded is 400 units. When the price is raised to $v.25, the quantity demanded falls to 350 units. The accented value of the indicate elasticity of need is _____.
2.5

Suppose demand is given by Q x d = 50 - 4P 10 + 6P y + A ten, where P x = $4, P y = $2, and A x = $50. What is the quantity demanded of expert ten?
96.

A firm's demand bend is usually:
more elastic than the market demand bend

The cross-cost elasticity of need for textbooks and copies of erstwhile exams is -3.5. If the cost of copies of old exams increase past 10 percent, the quantity demanded of textbooks will
fall by 35 percent.

When a firm practices cost discrimination in two market segments, the firm:
must be able to place market segments that have different price elasticities.

Suppose a house'southward profit is given by the equation π = -200 + 80Q - .2Q 2. Which of the following is true?
The business firm's profit-maximizing output is Q = 200.

The demand for fax machines in thousands of units has been estimated to exist Q = 1,000 – 1.5 P + 5 50, where P is the price of the machines and L is the average cost of a 10-infinitesimal midday call from Los Angeles to New York. At a fax automobile cost of $400 and a telephone call cost of $10, the price elasticity of demand for fax machines is:
–1.33

The need for a production is more rubberband the:
longer the time menstruum covered

If quantity demanded for sneakers falls by x% when price increases 25% we know that the accented value of the own-price elasticity of sneakers is:
0.4.

If the income elasticity for lobster is .6, a 25% increase in income will lead to a
15% increase in demand for lobster.

If the price of pork chops falls from $eight to $half-dozen, and this leads to an increase in demand for apple tree sauce from 100 to 140 jars, what is the cross price-elasticity of apple tree sauce and pork chops at a pork chop price of $6?
-0.86.

For a parking garage of fixed capacity, the possessor sets unlike parking rates for cars that are parked for less than 24 hours (short-term) and for those that are parked for more than 24 hours (long-term). To maximize acquirement, the operator should set prices and target the number of places for each segment such that:
the marginal revenues from the segments are equal.

The cross price elasticity of demand betwixt goods X and Y is -3.5. If the price of X decreases by 7%, the quantity demanded of Y will:
increase by 24.5%.

The demand for good X is estimated to be Q x d = 10, 000 - 4P X + 5P Y + 2M + A X, where P X is the price of 10, P Y is the price of skilful Y, Grand is income and A 10 is the amount of advertising on 10. Suppose the present price of good 10 is $50, P Y = $100, M = $25,000, and A X = 1,000 units. Based on this information, we know that the demand for good X is
inelastic.

The own-cost elasticity of demand for apples is -1.5. If the price of apples falls by 6%, what will happen to the quantity of apples demanded?
Information technology will increment 9%.

Since most consumers spend very little on salt, a small increase in the toll of salt volition
non reduce quantity demanded past very much.

The need for skilful X is estimated to be Q x d = ten, 000 - 4P X + 5P Y + 2M + A X, where P 10 is the price of X, P Y is the price of skillful Y, M is income and A X is the amount of advertisement on Ten. Suppose the present price of good X is $l, P Y = $100, K = $25,000, and A X = ane,000 units. Based on this information, the cross toll elasticity betwixt appurtenances Ten and Y is
0.008.

If the price of a expert or service increases, what happens to the house's need bend?
There is an upward movement along the demand curve.

The need for textbooks is Q = 200 – P + 25 U – 50 P beer. Assume that the unemployment rate U is 8 and the toll of beer P beer is $2. When the average price of a textbook is P = $100, the toll elasticity of demand is:
-0.5

If the marginal cost of seating a theatergoer is $5 and the elasticity of demand is –4, the profit-maximizing price is:
$6.67

El Niño current of air patterns affected the weather across the Usa during the winter of 1997–98.  Suppose the demand for home heating oil in Connecticut is given by Q  = 20 – 2 P_hho  + 0.5 P_ng  – TEMP, where Q  is the quantity of habitation heating oil demanded, P_hho  is the price of habitation heating oil per unit, P_ng  is the price of natural gas per unit, and TEMP is the absolute departure between the average wintertime temperature over the past 10 years and the current average winter temperature.  If the electric current cost of abode heating oil is $1.twenty, the electric current price of natural gas is $2.00, and the average winter temperature this year is 40 degrees compared to 28 degrees over the past ten years, the price elasticity of demand for home heating oil is:
–0.36

If the marginal cost of making a photocopy is three cents and the elasticity of demand is –2, the profit-maximizing price is:

El Niño wind patterns afflicted the weather across the United States during the winter of 1997–98.  Suppose the demand for habitation heating oil in Connecticut is given byQ = twenty – twoP_hho  + 0.vP_ng  – TEMP, whereQ is the quantity of home heating oil demanded,P_hho  is the cost of home heating oil per unit,P_ng  is the price of natural gas per unit of measurement, and TEMP is the absolute difference betwixt the average wintertime temperature over the past 10 years and the current boilerplate winter temperature.  If the electric current toll of abode heating oil is $ane.20, the current toll of natural gas is $ii.00, and the average winter temperature this year is 40 degrees compared to 28 degrees over the past 10 years, the quantity of habitation heating oil demanded is:

The post-obit table shows the total revenue and total toll (in dollars) from dissimilar sales volumes of the good.
Table 2-1

Refer to Table 2-one. What is the marginal profit of the firm from the sale of the 3rd unit of the good?

Which of the following correctly defines second-degree cost discrimination?

The seller offers different prices and customers choose the one that best suits them.

Which of the following is true of full-cost pricing?

Since fixed costs do not touch on optimal price and quantity, full-cost pricing is mistake-prone.

A manufacturer of infant wearing apparel has found that the need for its product is given byQ = 100P^–1.25A^0.v, whereP is cost andA is advertising expenditures. If marginal toll is $5, the profit-maximizing price is:

The demand for infinite heaters isQ = 250 –P + 2COOL, where COOL is the accented value of the difference between the boilerplate overnight low temperature and forty°F. Presume that the average overnight depression is 0°F. When the cost of space heaters isP = $30, the price elasticity of need is:

Assume that the price and income elasticities of need for luxury cars are Due east_P = -0.52 and E_Y = iii.2 respectively. In the coming yr, car prices are expected to ascension by 2 percent and income by eight percent. Based on this data, sales of cars are expected to _____.

The following table shows the total acquirement (in dollars) and full price (in dollars) from the production and sale of different units of a production.
Table two-i

Refer to Table 2-1. What is the profit-maximizing level of output for the business firm?

The income elasticity of demand is defined equally the:

percentage change in the quantity demanded divided by the pct change in per capita income

A market need curve is likely to shift to the right when:

A price elasticity of goose egg corresponds to a demand curve that is:

If the own cost elasticity of demand is infinite in absolute value, then

need is perfectly elastic.

The demand function in the above tabular array is Q₁₀^d = 100 - 2P_X. Based on this information, when Q₁₀ = 80, the price, P_Ten, (pointA) is

Since most consumers spend very little on salt, a small increment in the price of salt will

not reduce quantity demanded past very much.

The demand for cough medicine isQ = 10 – 2P. At a price of $2.50, the toll elasticity of need is:

The marginal cost of producing a paperback is half the marginal cost of producing a hardback version sold to consumers at four times the paperback cost. If the price elasticity of demand for paperbacks is –4, then the toll elasticity of demand for hardcover books is:

The price elasticity of marketplace need primarily depends on the:

availability of substitutes

The cost elasticity of demand is -2.0 for a certain firm's product. If the firm raises toll, the house manager can await total revenue to

Suppose the equilibrium cost in the market is $10 and the price elasticity of demand for the linear demand function at the market place equilibrium is -ane.25. Then nosotros know that

marginal acquirement is $2.

If the need for a good is price-elastic, a cut in price will:

lead to an increase in quantity demanded and an increase in the firm's revenue.

The demand for practiced Ten is estimated to be Q₁₀^d = 10, 000 - 4P_X + 5P_Y + 2M + A_X, where P_X is the toll of X, P_Y is the price of good Y, M is income and A_X is the amount of advertizing on 10. Suppose the present cost of good X is $l, P_Y = $100, One thousand = $25,000, and A_Ten = one,000 units. Based on this data, goods X and Y are

If toll is $25 when the price elasticity of need is –0.v, then marginal acquirement must be:

When a need curve is linear,

demand is rubberband at loftier prices.

Presume that the price elasticity of need is -0.75 for a certain house's product. If the firm lowers price, the firm'south managers can expect full acquirement to

If the demand function for a particular good is Q = 20 - 8P, so the price elasticity of need (in accented value) at a toll of $1 is

Given the total toll equation for a firm, the marginal cost equation can exist derived by:

taking the kickoff derivative of the price function with respect to quantity.

The quantity consumed of a practiced is relatively unresponsive to changes in price whenever demand is:

inelastic.

Suppose that at the equilibrium price and quantity the marginal revenue is -$15 and the price elasticity of demand for a linear demand function is -0.75. And so nosotros know that the equilibrium price is

The constant price elasticity of demand for cigarettes has been estimated to exist –0.5. To reduce smoking past fifty percent, approximately how much tax needs to be added to a $1 pack?

A good whose demand curve shifts to the left equally income increases is a(north):

Given that digital music players are used to play music downloaded from the Net, a fall in the price of digital music players will lead to:

an increase in the need for downloaded songs.

In Russia, as per capita income rises from $1,980 to $two,020, everything else remaining constant, annual per capita consumption of vodka falls from 525 to 475 liters; this implies an income elasticity of need for vodka of:

If a firm'due south profit is given by π = -150 + 360Q - 36Q², then its optimal output is:

A product's point price elasticity has been estimated at -1.5. At the initial cost of $20, the quantity demanded was ten units. If the firm cuts the price to $17.fifty, quantity demanded and sold is expected to increase by _____.

A graphical representation of the demand function is called a:

A turn a profit-maximizing firm's cost can be written in terms of marginal cost and cost elasticity of need as:

If the income elasticity of demand for a skillful is greater than 1, information technology implies that:

sales of the skillful are highly sensitive to changes in consumers' income.

When the price of sugar was "low", consumers in the United States spent a total of $3 billion annually on its consumption. When the price doubled, consumer expenditures actually

increased

 to $4 billion annually. This indicates that

none of the statements associated with this question are right.

If a house's demand function is of the course P = a - bQ, what is its marginal revenue equation?

MR = a - 2bQ

The demand for a product is given past Q = 600 - 30P. At P = $15, the house sells:

Suppose the own-price elasticity of demand for good Ten is -0.5, and that the price of good X increases by 10%. We would expect the quantity demanded of good Ten to

The need for food (a broad group) is more

inelastic than the demand for beefiness (specific commodity).

If the cross-price elasticity between ketchup and hamburgers is -2.5, a two% increase in the price of ketchup will lead to a

5% 5% drop in quantity demanded of hamburgers.

If a price increase from $5 to $seven causes quantity demanded to fall from 150 to 100, what is the absolute value of the own-cost elasticity at a cost of $7?

A profit-maximizing firm sets its price:

Suppose the own-price elasticity of demand for good 10 is -0.25, and that the quantity of good X increases by five%. What would you wait to happen to the total expenditures on practiced X?

Need is more inelastic in the curt-term considering consumers:

take no time to notice available substitutes.

Presume that Burger King, a fast food chain, enters into a franchise agreement. The royalty paid to Burger Rex by the franchisee is calculated every bit a pct of the franchisee's revenue. Given that the franchisee faces a downwards-sloping demand bend, which of the following is likely to be true?

The franchisee's revenue-maximizing output will be greater than its profit-maximizing output.

As we move down a linear demand curve, demand becomes:

The demand for infinite heaters isQ = 250 –P + 2COOL, where Absurd is the accented value of the difference betwixt the average overnight low temperature and 40°F. Presume that the average overnight low this month is twoscore°F. When the price of space heaters isP = $50, the price elasticity of demand is:

The demand for cable television set hookups isQ = 100 – 10P^1/2 + iiI^–1, whereP is price andI is per capita income. Cable Television receiver is a(n):

The elasticity that measures the responsiveness of consumer demand to changes in income is the:

Nosotros would expect the own price elasticity of demand for food to be:

less elastic than the demand for cereal.

Each week Neb buys exactly vii bottles of cola regardless of its price. Bill's ain price elasticity of demand for cola

in absolute value

 is:

You are the manager of a pop chapeau visitor. You lot know that the advertizing elasticity of demand for your product is 0.25. How much will you have to increase advertising in gild to increase demand by 5%?

20%.

more inelastic in the short-term than in the long-term.

Suppose Q_x^d = 10,000 - 2 P_x + iii P_y - 4.5M, where P_x = $100, P_y = $l, and M = $2,000. What is the own-price elasticity of need?

If the income elasticity for lobster is 0.4, a 40% increase in income will lead to a:

16% increase in demand for lobster.

The need for good X is estimated to be Q_ten^d = 10,000 - 4P_X + 5P_Y + 2M + A_Ten where P_X is the toll of X, P_Y is the price of good Y, M is income and A₁₀ is the amount of advertising on X. Suppose the present price of good X is $50, P_Y = $100, Chiliad = $25,000, and A₁₀ = 1,000 units. What is the quantity demanded of good X?

The demand for answering machines isQ = i,000 – 150P + 25I. Assume that per capita disposable incomeI is $200. When the price of answering machines isP = $10, the income elasticity of demand is:

If the own price elasticity of demand is infinite in absolute value, so

the demand curve is horizontal.

Makers of disposable diapers must advertise 5 percent more than to offset completely the 2 percent decline in sales due to heightened environmental concern. The advertising elasticity of demand is:

If quantity demanded for sneakers falls past six% when price increases 20% we know that the absolute value of the ain-toll elasticity of sneakers is

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