Vebsite 2018 C Solved For the forst tume in r Hased on thes

Vebsite 2018 C Solved: For the forst tume in r Hased on thes andormat ? erto.mheducation.com/hm.tpx Price (S) Quantity tions: All dollar responses should be entered as whole numbers Inclaude a minus (-) sign for all negative answer a. How much would the firm\'s revenue change if it lowered price from $12 to S107 is demand elastic or inelastic in this range Demand is rClick to select)in this range b. How much would the fiem\'s revenue change if it lowered price from $4 to $27 Is demand elastic or inelastic in this range? Demand is (Click to select) in this range c. What price maximizes the firm\'s total revenues? What is the elasticity of demand at this point on the demand curve? Price that maximizes total revenues Demand is [¡Click to select), at this point Type here to search 02

Solution

Req a: The revenue change is $ 8 The demand is elastic. As at price 12 quantity demand =1, Expenditure =12 At price 10 quantity =2, expenditure =20 Increase in expnediture =20-12 = 8 And there is negative relationship between price and expenditure, th demand is elastic. Req b: The Revenue change is ($8) The demand is inelastic. At P=4, Q = 5, expenditure =20 At P =2, Q =6, expenditure =12 Change =12-20 = -8 As there is positive relation between price and expenditure, the demand is inelasstic. Req c: Price that maximize the revenue is between $8- $6 The demand is Unit elasstic.