5. Here is a demand function: Circle the correct formula for marginal revenue (M
ID: 2429162 • Letter: 5
Question
5. Here is a demand function:
Circle the correct formula for marginal revenue (MR)
6. Circle your choice for the quantity that will maximize total revenue for the function in 5 (above). Circle your answer
1 3 4.5 5 6 7.5
11. Demand for X increases from 100 to 125 when the price of Y increases from $6 to $7. The cross-price elasticity of demand is. Circle your answer.
-3.67 -1.22 1.22 1.44 3.67 4.33
In questions 16-18 use these values in the multivariate demand function for Grapple tablets:
Pg = $500 Ph= $800 Pr = $700 Pdv = $50 Psc = $100 Pmm = $30 Ag = 40
A = $100,000 C = 2 Y=$30,000
?16. After the values above are entered into your demand function, what quantity of Grapple tablets will be demanded? Be very careful with this calculation. This value will be used again below. Circle your answer.
19401 28902 31027 35902 38902 40152
?17. What is the point price elasticity of demand for Grapple tablets at the above price (Pg)? Show the values you use in the formula and work out completely. Be sure to show the sign. Does this value indicate a very sensitive (elastic; responsive) relationship (write a one sentence comment)? The formula is:
18. What is the point cross-price elasticity of Grapple tablets with respect to the above price of Ronovo tablets (Pr)? Show the values you use in the formula and work out completely. Be sure to show the sign. Does this value indicate a very sensitive (elastic; responsive) relationship (write a one sentence comment)? The formula is:
Explanation / Answer
(Questions 5 & 6) Demand function is missing.
(Question 7) Answer: 1.44
Cross-price elasticity = (Change in demand for X / Average demand for X) / (Change in price of Y / Average price of Y)
= [(125 - 100) / (125 + 100)] / [$(7 - 6) / $(7 + 6)]
= (25 / 225) / (1 / 13)
= 1.44
(Questions 16 to 18) Demand function is missing.
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.