I really need help with this economics, can someone see if i did this right?
demand function P=2,000-50Q
a) to sell 20 units of Q, what price would have to be charged?
is this P=1000?
b) if firm sets a price of $500, how many units of Q would be sold
Q=30?
c) what is the price elasticity of demand if price equals $500
.06?
d) at what price if any, will the demand of Q be unitary elastic
this one i just dont know how to do
any help would be greatly appreciated
Answer:
Here goes:
A. P=2000-(50*20) = 1000
B. 500=2000-50Q
Do the math, and you get 1500=50Q
Q=1500/50 = 30
C. Price Elasticity of demand refers to the amount the price changes when the quantity changes by 1 unit, when both are expressed in percentage terms. So at a price of $500, adding an additional 1 unit of quantity would reduce the price $50/500=.1, while the quantity would increase by 1/30=.0333.
When you take the Delta (P)/Delta (Q), you get (.1/.033)=3.
D. When a good is at unitary elasticity, a change in quantity will cause an equal change in price. In the case of this good, the place where elasticity equals one is 19 units. When you increase quantity to 20 units (a 5% increase), the price goes from $1050 to $1000 (a 5% decrease).
A good source for this, surprisingly enough, is Wikipedia. Please review their article on demand elasticity, it is fairly thorough. Thanks for the question, it's been a few years since I reviewed my microeconomics.
You know, I need to go and study for this subject myself. I'll come back tomorrow night and try to answer you. Good luck.
You know, I could still answer that question but in stead I will tell you and your Economics professor a little secret that I am certain is much more correct then all the theories you are uselessly studying. The world pisses on Economic theory because their are no operative free market systems. The government(s) all subsidize and tax so many factors of production and imports and exports and added value enterprises that not one of the theories is applicable to the real world. Change your major.... Or just do enough to get your MA or CMA and join the salt miners.
More Questions and Answers:
In what ways can you APPY ECONOMICS IN YOUR DAILY LIFE?
35. Suppose that a firm's legal staff concludes that a new?
Why did Supply-side economists believe taxes caused inflation?
If unemployment is zero,what happens to real wages?
How can i know about Economic Conferences taking place at the international level?
How do Changes in the Money Supply Effect Inflation?
We are publishing our own rupees note in nasik. but why we have so much credits for various countri..es?
What is the purpose of trade union?
How does competiotion benefit and regulate the marketplace?
a) to sell 20 units of Q, what price would have to be charged?
is this P=1000?
b) if firm sets a price of $500, how many units of Q would be sold
Q=30?
c) what is the price elasticity of demand if price equals $500
.06?
d) at what price if any, will the demand of Q be unitary elastic
this one i just dont know how to do
any help would be greatly appreciated
Answer:
Here goes:
A. P=2000-(50*20) = 1000
B. 500=2000-50Q
Do the math, and you get 1500=50Q
Q=1500/50 = 30
C. Price Elasticity of demand refers to the amount the price changes when the quantity changes by 1 unit, when both are expressed in percentage terms. So at a price of $500, adding an additional 1 unit of quantity would reduce the price $50/500=.1, while the quantity would increase by 1/30=.0333.
When you take the Delta (P)/Delta (Q), you get (.1/.033)=3.
D. When a good is at unitary elasticity, a change in quantity will cause an equal change in price. In the case of this good, the place where elasticity equals one is 19 units. When you increase quantity to 20 units (a 5% increase), the price goes from $1050 to $1000 (a 5% decrease).
A good source for this, surprisingly enough, is Wikipedia. Please review their article on demand elasticity, it is fairly thorough. Thanks for the question, it's been a few years since I reviewed my microeconomics.
You know, I need to go and study for this subject myself. I'll come back tomorrow night and try to answer you. Good luck.
You know, I could still answer that question but in stead I will tell you and your Economics professor a little secret that I am certain is much more correct then all the theories you are uselessly studying. The world pisses on Economic theory because their are no operative free market systems. The government(s) all subsidize and tax so many factors of production and imports and exports and added value enterprises that not one of the theories is applicable to the real world. Change your major.... Or just do enough to get your MA or CMA and join the salt miners.
The answers post by the user, for information only, FunQA.com does not guarantee the right.
More Questions and Answers: