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coldgirl [10]
3 years ago
6

. Suppose you own a bookstore. You believe that you can sell 40 copies per day of the latest John Grisham novel when the price i

s $35. You consider lowering the price to $25 and believe this will increase the quantity sold to 50 books per day. Compute the price elasticity of demand using the mid-point formula and these data. Select the correct implication from your work.
Business
1 answer:
Iteru [2.4K]3 years ago
7 0

Answer:

PED = 0.67 inelastic demand

you should not lower the price of the book

Explanation:

the midpoint formula for calculating price elasticity of demand = {(Q2 - Q1) / [(Q2 + Q1) / 2]} /  {(P2 - P1) / [(P2 + P1) / 2]}

PED = {(50 - 40) / [(50 + 40) / 2]} /  {(25 - 35) / [(25 + 35) / 2]} = [10 / (90 / 2)] /  [-10 / (60 / 2)] = (10 / 45) / (-10 / 30) = 0.222 / -0.333 = 0.67

the PED = 0.67 which means that the demand is inelastic

if you lower the price of the book, the increase in number of books sold will be proportionally lower than decrease in price, so you will lose money by doing that.

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Government survey takers determine that typical family expenditures each month in the year designated as the base year are as fo
valentina_108 [34]

Answer:

CPI = NEW PRICE / OLD PRICE = 776 / 760 = 1.02

INFLATION = CPI / OLD PRICE x 100 = 1.02 / 760 x 100 = 0.13%

Explanation:

Government survey takers determine that typical family expenditures each month in the year designated as the base year are as follows:

• 25 pizzas, $10 each •

Apartment rent, $600 per month

• Gasoline and car maintenance, $100 per month

• Phone service (basic service plus 10 long-distance calls), $50 per month In the year following the base year,

the survey takers determine that pizzas have risen to $11 each, apartment rent is $610, gasoline and maintenance costs are $115, and phone service has dropped in price to $40.a. Find the CPI in the subsequent year and the rate of inflation between the base year and the subsequent year.

ITEM             OLD PRICE        NEW PRICE

pizzas,                 $10                   $11

Apartment rent, $600                $610

Gasoline             $100                 $115

Phone service     <u>$50</u>                  <u>$40</u>

TOTAL.                <u>760</u>                   <u>776</u>

<u />

CPI = NEW PRICE / OLD PRICE = 776 / 760 = 1.02

INFLATION = CPI / OLD PRICE x 100 = 1.02 / 760 x 100 = 0.13%

6 0
3 years ago
When calculating the net operating income of a property, it is important to identify any expenses that will be incurred in attem
Fantom [35]

Answer:

The correct answer is letter "C": Mortgage payments.

Explanation:

Net Operating Income or NOI reflects income after operating expenses deducted but before income taxes and interest are deducted. If the result is a positive value it is called <em>Net Operating Income</em>. If the figure is negative, it is referred to as <em>Net Operating Loss</em>.

Net operating income is often used to calculate real estate income, such as residential properties or commercial properties. <em>NOI is calculated by determining the Gross Operating Income (Gross potential income minus vacancy and credit loss) and subtracting the operating expenses (maintenance, fees, and insurance). </em>

<em> </em>

Thus, <em>mortgage payments are not considered in the calculation of the NOI.</em>

6 0
3 years ago
All of the money borrowed by the united states government over the years and still outstanding is called the national:
geniusboy [140]
<span>the national or federal debt consists of all the money borrowed over the years by the national government that is still outstanding. The national debt is the public and intragovernmental debt owed by the federal government. Two-thirds of the U.S. debt is the Treasury bills, notes and bonds owned by to the public. They include investors, the Federal Reserve, and foreign governments.</span>
4 0
3 years ago
If it costs $75,000 to put on an event and total revenue is $135,000, what is the profit as a percentage of revenue?
Nuetrik [128]

Answer:

44.44%

Explanation:

Profit is obtained by subtracting cost from revenue.

I,e.,

Profit = revenue - cost.

In this case,

Profit = $135,000 - $75,000

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4 0
3 years ago
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gizmo_the_mogwai [7]

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Advantages - 1. Affordable  2. Pretty scenery 3.You get what you paid for

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2. Yes it has own Overwhelming resources and capabilities  3. Train

Explanation:

4 0
3 years ago
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