Question

Demand is rep as:  q= (100- p)^2 Determine the price elasticity of demand at $30 and explain...

Demand is rep as:  q= (100- p)^2

Determine the price elasticity of demand at $30 and explain what you think about setting the price at $30. Would you change the price to maximize revenue?

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

In the question ,we have given a demand function and price as $30 and we have been asked to find price elasticity of demand at this price and also we also want to know if this price maximizes revenue.

For the price elasticity of demand we have to firstly differentiate the demand function with respect to quantity q and then use the value in the price of demand formula which is percentage change in quantity divided by percentage change in price.

For the second part , we have to find derivative of revenue function and set that equal to zero.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
The equation for a demand curve is P=2/Q. What is the elasticity of demand as price...
The equation for a demand curve is P=2/Q. What is the elasticity of demand as price falls from 5 to 4? What is the elasticity of demand as the prices falls from 9 to 8? Would you expect the answers to be the same? Why/why not?
(a) find the elasticity of the demand function q = (15000) / (p^2 + 50) when...
(a) find the elasticity of the demand function q = (15000) / (p^2 + 50) when the price is p = 10 Dollars. (b) If the price increases, will the revenue increase or decrease? Explain how you conlcuded this from your elasticity value.
1.A demand function given by: Q = 240 ‒ 3P. What is the price elasticity of...
1.A demand function given by: Q = 240 ‒ 3P. What is the price elasticity of demand when the price is P = $10? You will have to use the point elasticity formula. The price elasticity of demand at this price is ___________ 2.Consider the same demand equation, Q = 240 ‒ 3P. If a firm sells at the unit elastic price on this demand curve, what is the total revenue it will receive? The total revenue received at this...
This is a price setting firm problem.(show all work) Demand Function: P=32-Q Total Cost Function: C=Q²+8Q+4...
This is a price setting firm problem.(show all work) Demand Function: P=32-Q Total Cost Function: C=Q²+8Q+4 Profit maximizing price is.....? Profit maximizing quantity is......? Profit is......? Lerner Index Value is......? Price Elasticity of Demand is......? To maximize sales, this firm would change a price...... and sell a quantity of..........?
1. Explain the difference between price elasticity of demand and income elasticity of demand. 2. If...
1. Explain the difference between price elasticity of demand and income elasticity of demand. 2. If demand is elastic, how will an increase in price change total revenue?
2. Calculate price elasticity of demand, cross price elasticity of demand and income price elasticity of...
2. Calculate price elasticity of demand, cross price elasticity of demand and income price elasticity of demand. Then indicate whether the alternative good is a complement or substitute. P =10, PA=20, and I =100. a) Q = 500 - 3P + 4PA + I (I stands for income) b) Q = 100 - 0.1P - 0.5PA - 0.2I
The short term demand for a product can be approximated by q = D(p) = 18...
The short term demand for a product can be approximated by q = D(p) = 18 − 2 √p where p represents the price of the product, in dollars per unit, and q is the number of units demanded. Determine the elasticity function. Use the elasticity of demand to determine if the current price of $50 should be raised or lowered to maximize total revenue.
Question 5 A. Explain five uses of the concept of elasticity of demand. B. The demand...
Question 5 A. Explain five uses of the concept of elasticity of demand. B. The demand curve for widgets is QD = 10,000 - 25P. a. How many widgets could be sold for $100? b. At what price would widget sales fall to zero? c. What is the total revenue (TR) equation for widgets in terms of output, Q? What is the marginal revenue equation in terms of Q? d. What is the point-price elasticity of demand when P =...
The demand for an economics textbook is given by: P = 250 –Q, where P is...
The demand for an economics textbook is given by: P = 250 –Q, where P is the price in dollars of a textbook and Q is the quantity demanded of textbooks (per week). Use the point price elasticityofdemandformulatocalculate: [Showyourworkinallpartsofthisquestion] The price elasticity of demand at a price of $50 per textbook [3points] The price elasticity of demand at a price of $150 per textbook [3points] If the goal of the seller were to increase total sales revenue, would you recommend...
The consumer demand equation for tissues is given by q = (96 − p)2, where p...
The consumer demand equation for tissues is given by q = (96 − p)2, where p is the price per case of tissues and q is the demand in weekly sales. (a) Determine the price elasticity of demand E when the price is set at $31. (Round your answer to three decimal places.) E = Interpret your answer. The demand is going by % per 1% increase in price at that price level. (b) At what price should tissues be...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT