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Usimov [2.4K]
3 years ago
11

If a 1 percent decrease in price results in less than a 1 percent increase in the quantity demanded, demand is Multiple Choice c

ross-price elastic. price inelastic. price elastic. status quo elastic. derived demand inelastic.
Business
1 answer:
Vlada [557]3 years ago
3 0

Answer:

The correct answer is price inelastic.

Explanation:

The price elasticity of demand is the measure of the responsiveness of quantity demanded of a product to the change in its price. It is calculated as the ratio of change in quantity demanded and change in the price.

Relatively inelastic dmeand refers to the situation where a proportionate change in price causes less than proportionate change in quantity demanded.

Here, if a 1% decrease in price causes less than a 1% increase in quantity demanded then the demand is relatively inelastic.

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Suppose that the U.S. government decides to charge cola producers a tax. Before the tax, 50 billion cases of cola were sold ever
Georgia [21]

Answer:

U.S. Tax Burden on Cola:

The amount of the tax on a case of cola is $4 per case. Of this amount, the burden that falls on consumers is $1 per case, and the burden that falls on producers is ___$3______ per case.

The effect of the tax on the quantity sold would have been larger if the tax had been levied on consumers.

a. True

b. False

Explanation:

The tax burden on consumers, which is represented by the difference in the price of cola from $5 to $6 per unit is $1 ($6 - $5).  However, the cash received by producers reduced by $3 from $5  to $2.  This shows that the total tax burden on both consumers and producers is $4 ($1 + $3).

This represents a total tax burden of $4 or about 67% based on the new selling price of cola or 80% based on the old selling price of cola.

"The effect of the tax on the quantity sold would have been larger if the tax had been levied on consumers alone.   This because the price of cola would have increased to $9 per unit.  Since the demand for cola in this instance is elastic, this change in price would have caused a more than 80% change in the quantity demanded.

4 0
3 years ago
Show how Cablevision can conduct an ROI analysis. Describe the information that the company should collect and how it should b c
Flauer [41]

Answer:

Explanation:

Cablevision can easily accomplish this by doing the following. First gather the number of sales of premium services and other products that non-trained individuals are accomplishing in a given time period (example, one month). Next, under the same conditions place the newly trained individuals and gather the same data from them (number of sales/subscribers gained, premium products, and other products). Finally, they would simply need to compare the difference in the number of sales to see if the training paid off. They would also need to calculate if the difference in sales surpasses the costs of training.

3 0
3 years ago
Consider the case of BTR Co.: BTR Co. has 9% annual coupon bonds that are callable and have 18 years left until maturity. The bo
valentinak56 [21]

Answer:

Yield to maturity is 7.93%

Yield to call is  7.83%

Explanation:

I calculated both the yield to maturity and yield to call using the rate formula in excel which is =rate(nper,pmt,pv,-fv)

nper is the year to maturity and year to call of 18 years and 8 years respectively.

pmt is the periodic coupon payment is 9%*1000=$90 in each case.

pv is the present value in each  case of $1100.35

The future value which is the redemption value is $1000 for yield to maturity and $1060 for yield to call

Find attached detailed calculation

Download xlsx
5 0
3 years ago
Top management of Drexel-Hall is considering closing Store 3. The three stores are close enough together that management estimat
Zarrin [17]

Answer:

Compute the increase or decrease that closing Store 3 should cause in: a. Total monthly sales for Drexel-Hall stores.

  • total monthly sales should decrease from $1,800,000 to $1,380,000 = a $420,000 reduction

b. The monthly responsibility margin of Stores 1 and 2.

  • store 1 responsibility margin increased from 10% to 12.55% (2.55% increase)
  • store 2 responsibility margin increased from 9% to 13.69% (4.69% increase)

c. The company’s monthly income from operations.

  • increased from $72,000 to $140,200 ($70,200 increase)

Explanation:

                                                Store                 Store                Total                                          

                                                   1                         2

Sales                                         $660,000          $720,000     $1,380,000

Variable costs                          $409,200          $453,600        $862,800

Contribution margin                $250,800          $266,400         $517,200

Controllable fixed costs           $120,000          $102,000        $222,000

Performance margin                $130,800           $164,600        $292,200

Committed fixed costs              $48,000            $66,000         $114,000

Store responsibility margin      $82,800             $98,600        $178,200

Common fixed costs                                                                    $38,000

Income from operations                                                             $140,200

4 0
3 years ago
The U.S. consumer market is large, but other markets may offer what advantage?
Inga [223]
The difference other markets; apart from the US market, have is tht they have exotic wishes which need to be fullfilled but more importantly they have other goods, perhaps not created on the US market. This makes other economies a viable way to earn more mone for the US economy.
3 0
3 years ago
Read 2 more answers
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