In Example 2.8, we discussed the recent increase in world demand for copper, due in part to China's rising consumption. Using the original elasticities of demand and supply (i.e., Es=1.5 and Ep = -0.5), calculate the effect of a 30-percent increase in copper demand on the price of copper. Recall that the demand equation is Q=27-3P, the supply equation is Q= -9+9P, the initial equilibrium price is P* = $3.00 (dollars per pound), and the initial equilibrium quantity is Q* 18 (million metric tons per year). As a result of this change in demand, the price of copper will by $ (Enter your response rounded to two decimal places.)
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- Suppose the demand for bicycles is given byQp = 10,000P- and the supply of bicycles is given by Qs = 0.01P3. (a) Using calculus and the given supply and demand curves, find mathematical expressions for the elasticities of demand and supply as a function of the price. Use these expressions to demonstrate that both curves have constant elasticity along their entire length. (b) Find the equilibrium price and quantity in this market mathematically.Harding Enterprises has developed a new product called the “Quest Simulator (QS)”. The market demand for this product is given as follows: Q = 240 - 4P. If QS is priced at $40, what is the point price elasticity of demand? Is demand elastic or inelastic? What is the maximum amount that consumers are willing to pay for the quantity demanded at the price of $40? (hint: it includes both the total expenditures and the consumer surplus) If the price of QS is increased slightly from $40, what will happen to the total expenditure on the product? What will happen to the consumer surplus? Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.Consider the market for laptops. Suppose that, due to a microchip shortage, laptop prices increased from $1,800 to $2,000. Over the same time period, laptop sales to consumers have decreased from 734,000 to 700,000 units. One way to calculate the elasticity of demand from these two points is to use the midpoint method (as discussed in the online lecture). Remember, use the absolute value for your answer. Using this method, the elasticity of demand for laptop computers is about: Select one: Oa. 1.27 Ob. 0.79 Oc. 2.48 Od. 0.45
- Recently, gas prices have soared across the capital region. When the average gas price rose from $3.60 a gallon to $4.40 a gallon, the region observed a slight decrease in consumption of gasoline from 600 million gallons per year to 590 million gallons per year.Based on this information, what would you estimate that the price elasticity of demand is for gasoline in the Capital region? (The answer could be negative or positive and is not necessarily a whole number).When the U.S. government announced that a domestic mad cow was found in December 2003, analysts estimated that domestic supplies would increase in the short run by 10.4% as many other countries barred U.S. beef. An estimate of the price elasticity of beef demand is - 1.6 (Henderson, 2003). Assuming that only the domestic supply curve shifted, how much would you expect the price to change? If quantity increases by 10.4%, then price will V by % (Enter your response rounded to two decimal places). decrease ceiv increase respot -respot u must c our respot You must re structions to Step 1. Click d Paused Step 2. Read t Step 3. Post re tv 30 MacBook Air 80 DII DD esc F10 F1 F12 F1 F2 F3 F4 F5 F6 F7 FB F9 @ # 2$ * 1 2 3 4. 5 7 8 Q W 11Suppose the supply and demand curves for a particular product are given by: QS = -20 + 2P , QD =100 - 2P where QS and QD are quantities in units and P is the price per unit. Calculate both the demand and supply elasticity around the equilibrium point. [Hint: you can use either the point method or the average arc (midpoint) method.]
- Star wars coffee mugs are traded in a competitive world market with a price of R180 per cup. Unlimited quantities are available for import into South Africa at this price. On average 10 000 kg are traded each month. The elasticity of demand has been estimated at -0.81 and elasticity of supply at 3.51. Derive the demand equation for the star wars coffee mug. . . A. Qd = 12 800 - 45P B. Qd = 15 200 - 35P C. Qd = 18 100 - 45P D. Qd = 20 000 - 50P Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.Calculate the elasticity of demand, if the demand function is Q=160-8p + 32Y, at the point where p = 14 and Q = 10. The elasticity of demand is ε = -11.2. (Enter your response rounded to one decimal place and include a minus sign.) Calculate the elasticity of demand, if the demand function is The elasticity of demand is ε = . (Enter your response rounded to one decimal place and include a minus sign.) Q=12p-².When the U.S. government announced that a domestic mad cow was found in December 2003, analysts estimated that domestic supplies would increase in the short run by 10.4% as many other countries barred U.S. beef. An estimate of the price elasticity of beef demand is -1.6 (Henderson, 2003). Assuming that only the domestic supply curve shifted, how much would you expect the A price to change? If quantity increases by 10.4%, then price will V by % (Enter your response rounded to two decimal places). Fin eceiv decrease on. increase respot ur respot ou must c Your respot You must re nstructions to Paused Step 1. Click o Step 2. Read Step 3. Post re tv 30 MacBook Air DII DD 80 F12 F9 F10 F7 F8 esc F5 F6 F2 F3 F4 F1 @ # $ & 8 2 3 4 Q W R Y %3D ... この * 00
- Online the timing and tailoring of prices to specific products is the key to successful pricing in online markets. And " Thanks to the ready availability of data in online markets, a pricing manager can easily approximate the elasticity of demands for the different products it sells online." Assuming a 10 percent decrease in price increases sales by 30 percent, calculate the price elasticity of demand? If the wholesale price of the online product is $50 and sells at a price comparison site that charges $0.50 per click and boasts a conversation rate of 5 percent ( an average of 20 percent clicks are needed to generate sale), the incremental cost of each sale is $50. What price should you change for the product? What is the markup? B) . The authors assert that price sensitivity is affected by (1) product cycle, and (2) number of competitors. In fact, " When the number of competing sellers doubles, a firm's elasticity of demand is expected to double ( you should be able to verify this…Suppose you are advising an industry association on the predicted effects of a price change on quantity demanded and total expenditure on its product. The current price is $1.20 per unit, and quantity demanded is 2500 units per day. Based on extensive empirical studies, you know that price elasticity of demand for the product is 0.7. If the price increases to $2.20 per unit, what is the predicted percentage change in quantity demanded? Will total expenditure increase or decrease? (Remember to use the averaging method to calculate the percentage change in price.) The predicted percentage change in quantity demanded is%. (Enter your response rounded to the nearest integer. Do not include a negative sign in your response.) Will total expenditure increase or decrease? Total expenditure is related with price because the price elasticity of demand is Question Viewer so total expenditure will 1The demand function for bicycles in Holland has been estimated to be ?=2 000+15?−5.5? Where Y is income in thousands of euros, Q is the quantity demanded in units, and P is the price per unit. When P = 150 euros and Y = 15(000) euros, determine the following: Price elasticity of demand Income elasticity of demand Define cross-price elasticity and point elasticity