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Llana [10]
3 years ago
11

The price elasticity of demand for gasoline in the short run has been estimated to be 0.4. If a war in the Middle East causes th

e price of crude oil (from which gasoline is made) to increase, how will that affect total revenue from gasoline in the short run, all other things unchanged
Business
1 answer:
disa [49]3 years ago
8 0

Answer:

Total revenue would rise in the short run

Explanation:

A price elascitiy of 0.4 indicates that demand is inelastic.

Inelastic demand means that a small change in price has little or no effect on quantity demanded. The absolute value of inelastic demand is less than 1.

If the cost of the crude oil increases, the price of gasoline would increase too. Because demand is price inelastic , there would be little or no change in the quantity demanded of gasoline as a result total revenue would increase as a result of the rise in price.

I hope my answer helps you

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Alex works at the Pretzel Factory. The customers always compliment the pretzels Alex makes, saying they taste better than any ot
defon
Tell Alix to make smaller pretezls. They will taste better, but use less ingredients, therefore keeping the cost lower than it is now. Hope this helps!
8 0
3 years ago
Zytel Corporation produces cleaning compounds and solutions for industrial and household use. While most of its products are pro
SCORPION-xisa [38]

Answer:

4,513 approx.

Explanation:

The computation of the minimum number of jars of silver polish is shown below:-

Sales revenue for one jar of silver polish    $5.60

Sales revenue for 1/4 pound of Grit 337     0.85

($3.40 ×  1 ÷ 4)

Incremental revenue from

further processing                                        $4.75

($5.60 - 0.85)

Incremental costs of further processing:

Processing costs                      $2.40

Selling costs                              $0.40          $2.80

Incremental contribution

margin from further

processing into silver polish

per jar                                                            $1.95

($4.75 - $2.80)

Point of indifference denotes the point where all options are equally profitable. But after that we will see that more processing is profitable. This is due to the fixed costs involved in further production.

Thus Minimum number of jars needed to produce to justify the further processing = Avoidable Fixed cost ÷ Incremental contribution

= $8,800 ÷ $1.95

= 4,513 approx.

8 0
2 years ago
All of the following statements are true regarding negotiated municipal underwritings EXCEPT the:A initial offering price of eac
Sever21 [200]

Answer:

D

Explanation:

customer must be sent a copy of the official statement, if available

5 0
3 years ago
Would you expect holding cost to go down with increases in maximum capacity?
xxTIMURxx [149]

Answer: The answer is given below

Explanation:

Holding costs are the costs that.has to do with the storage of inventory that were not sold. costs and they are storage space, price of damaged or spoilt goods, labor, and insurance.

It should be noted that with regard to holding cost, increasing peak capacity will be expected to reduce since the capacity is typically inversely proportional to the theory of the holding cost as there may be a reduction in the holding cost so as to increase the capacity.

3 0
3 years ago
If a family spends its entire budget in a given time frame, the family can afford either 10 restaurant meals or 30 home meals. A
Andrej [43]

The opportunity cost of one extra restaurant meal in the time frame is 3 home meals.

<h3>What is opportunity cost?</h3>

Opportunity cost of the next best option forgone when one alternative is chosen over other alternatives. When the family chooses to go for the restaurant meal, they forgo the opportunity for a home meal.

Opportunity cost  = 30 / 10 = 3

To learn more about opportunity cost, please check: brainly.com/question/26315727

7 0
2 years ago
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