1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
ra1l [238]
4 years ago
12

Calculate the Price Elasticity of Demand (PED) for diamond rings if there is a price increase from $10,000 to $12,000 and quanti

ty demanded falls from 100,000 to 90,000. Does this answer support what we have learned about elasticity (i.e. the Determinants of PED) and what we might expect for diamond rings
Business
1 answer:
Vadim26 [7]4 years ago
7 0

Answer:

-0.578 and inelastic

Explanation:

The computation of the price elasticity of demand using mid point formula is shown below:

= (change in quantity demanded ÷ average of quantity demanded) ÷ (percentage change in price ÷ average of price)  

where,  

Change in quantity demanded would be

= Q2 - Q1

= 90,000 - 100,000

= 10,000

And, average of quantity demanded is

= (90,000 + 100,000) ÷ 2

= 95,000

Change in price would be

= P2 - P1

= $12,000 - $10,000

= $2,000   0.1052  0.1818

And, average of price is

= ($10,000 + $12,000) ÷ 2

= $11,000

So, after solving this, the price is -0.578

This reflects the inelastic for diamond rings

You might be interested in
Why is it important to be present and active in your courses?
nalin [4]
It is important to Learn, and Write down Results/Notes.
5 0
4 years ago
Read 2 more answers
Nelson Company's Radio Division currently is purchasing transistors from Charlotte Co. for $3.50 each. The total number of trans
melamori03 [73]

Answer:

The range of possible transfer is $ 3.25 to $ 3.50

Explanation:

Data provided:

The purchasing cost of the transistor = $ 3.50

The total number of transistors needed = 8,000

The production cost of the transistor = $ 4.00

The included variable cost = $ 3.25

The included fixed cost = $ 0.75

Now,

the fixed cost cannot be altered, thus it will be there

hence,

the variable cost will be the factor that will evaluate the decision i.e $ 3.25

therefore, the <u>range of possible transfer is $ 3.25 to $ 3.50</u>

3 0
3 years ago
The president of the Micro Brewing Corporation asks you, as the company economist, to forecast changes in consumer beer purchase
umka21 [38]

Answer:

It is more profitable to raise the selling price by $2.

Explanation:

To determine whether the company should raise the selling price, we need to determine the effect on income. <u>The best option is the one with the higher sales revenue.</u>

Sales revenue= selling price * number of units

<u>Current:</u>

Sales revenue= 5.5*2,200= $12,100

<u>Proposal:</u>

Sales revenue= 7.5*1,800= $13,500

It is more profitable to raise the selling price by $2.

7 0
3 years ago
When preparing the operating activities section of the statement of cash flows using the indirect method, a decrease in accounts
PSYCHO15rus [73]

Answer:

True

Explanation:

statement of cash flows can be regarded as financial statement which gives analysis of how cash as well as cash equivalent is affected by any changes in balance sheet accounts.

The indirect method of statement of cash flows begins with loss or the net income as well as the substraction of values from non cash revenue which result in case flow as a result of operating activities.

7 0
3 years ago
During a pandemic, goods and services may become scarce as a result of: A. Unwillingness to purchase goods and services due to f
lions [1.4K]

Answer: D. Restrictions on travel into and out of affected areas.

Explanation:

Restrictions on travel in and out of affected areas can lead to Scarcity in a Pandemic because there is no free movement of labour and capital.

With borders shut down, goods that were normally imported will suddenly become very hard to acquire because getting them through travel bans is very hard and in most cases, impossible.

Also affected are services as, for instance, the people who provided such services might live in or come from the place they provide said service to. Getting into those areas might prove too cumbersome a task thereby limiting Service provision.

Looking at the current Corona Virus Pandemic that has seen the most extensive Travel Restrictions by Countries in recent times and looking at the Scarcity being suffered by those same countries, drawing the conclusion that the Scarcity is as a result of an impediment to free movement of Goods and Services is most logical.

4 0
4 years ago
Read 2 more answers
Other questions:
  • According to immanuel wallerstein, currently, there are many countries whose production is owned or leased by dominating countri
    10·1 answer
  • Charlton is the maker of a $200,000 promissory note payable to Development &amp; Sales Corporation. Development &amp; Sales indo
    11·2 answers
  • The graph above shows how the price of video games varies with the demand quantity. The equilibrium _____ is $50, and the equili
    8·1 answer
  • On December​ 31st, Datton, Inc. has cost of goods sold of $ 550000​, ending inventory is $ 101000​, beginning inventory is $ 120
    8·1 answer
  • If a firm sells on terms of 2/10, net 30 days, and its DSO is 28 days, then the fact that the 28-day DSO is less than the 30-day
    6·1 answer
  • Beverly Company has determined a standard variable overhead rate of $1.25 per direct labor hour and expects to incur 1 labor hou
    8·1 answer
  • On September 1, 2021, Red Co., issued $48 million of its 10% bonds at face value. The bonds are dated June 1, 2021, and mature o
    13·1 answer
  • Selected income statement data follow for Harley Davidson, Inc., for the year ended December 31, 2016 (in thousands): Income bef
    6·1 answer
  • Todd Harris and Associates, a New York sales promotion agency, discovered from an analysis of its files that one-quarter (or 25
    9·1 answer
  • The discount rate is the: multiple choice 1 interest rate at which banks can borrow reserves from other banks. lowest interest r
    13·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!