Answer:
Price elasticity of demand = Change in Quantity/ Change in Price
Using midpoint formula;
Change in Quantity ;
Change in Price;
Price elasticity of demand = -0.342/0.118
= -2.90
Demand is elastic, so decreasing ticket prices will increase revenue.
When the elasticity is larger than 1 it means that a 1% change in price will change demand by more than 1%. In this case, a a decrease of price by 1% will bring 2.9% increase in customers.
What are you asking in this question I’m just confused, could you write it in the comments
Answer:
Case A $581,757.17
Case B $500,000.00
Case C $416,910.21
Explanation:
Current price of a bond
The market price of a bond can be computed using the pv formula in excel, which is given as :
=pv(rate,nper,pmt,fv)
Where rate is the yield to maturity on the bond divided by 2 since the bond in question is semi-annual interest paying bond i.e
Case A 4%/2=2%
Case B 6%/2=3%
Case C 8.5%/2=4.25%
The nper is the time to maturity of the bond multiplied by 2 for the same reason cited for yield to maturity i.e 10 years *2=20
The pmt is the semi-annual coupon interest payable by the bond i.e 6%/2*$500,000=$15,000
The fv is the future value of the bond given as $500,000
Case A
=-pv(2%,20,15000,500000)
Pv= 581,757.17
Case B
=-pv(3%,20,15000,500000)
PV=$$500,000.00
Case C
=-pv(4.25%,20,15000,500000)
PV=$416,910.21
<span>I believe it's Press Release. </span>
