QUESTION TWO X limited is a company producing two products A and B. The Marketing Manager has the following information for the products for the first quarter of 2020: Product Demand (Units) Price (K`000) January March January March A 30 15 10 12 B 25 30 10 2 The Marketing Manager wants to establish the Price Elasticity of Demand (PED) of the two products and strategize for increase in sales revenue. Required: (a) Define Price Elasticity of Demand (PED) (b) Calculate PED for Product A at price K5,000 per unit (c) Explain the significance of PED for the Marketing Manager in a country like Zambia.
QUESTION TWO
X limited is a company producing two products A and B. The Marketing Manager has the following
information for the products for the first quarter of 2020:
Product
(Units)
(K`000)
January March January March
A 30 15 10 12
B 25 30 10 2
The Marketing Manager wants to establish the Price
and strategize for increase in sales revenue.
Required:
(a) Define Price Elasticity of Demand (PED)
(b) Calculate PED for Product A at price K5,000 per unit
(c) Explain the significance of PED for the Marketing Manager in a country like Zambia.
(d) On the basis of PED for each product the Marketing Manager wants to increase sales
revenue for both products.(i) Interpret the results and
(ii) Indicate the strategic option available for the manager as the projects increase in
sales revenue.
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