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Pachacha [2.7K]
3 years ago
9

An increase in the price of hot dogs from $1.50 to $2.10 per pound increased the average number of burgers demanded per week fro

m 300 to 360. Assuming that all other economic variables were held constant, what is the cross-price elasticity of demand between hot dogs and burgers? What does this elasticity tell you about the relationship between the two?
Business
1 answer:
timama [110]3 years ago
7 0

Answer:

0.5

They are substitute goods.

Explanation:

Cross price elasticity of demand measures the responsiveness of quantity demanded of good A to changes in price of good B.

Percentage change in quantity demanded of burgers = (360 - 300) / 300 = 0.2 = 20%

Percentage change in price of hot dog = (2.10 - 1.50) / 1.5 = 0.4 = 40%

Cross price elasticity of demand = percentage change in quantity demanded/ percentage change in price

20 / 40 = 0.5

Elasticity of demand is less than 1, so demand is inelastic.

Also, the cross price elasticitiy is positive, so the goods are substitutes goods.

I hope my answer helps you

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Buff is considering a new packaging machine. The initial cost is $10,000 and we would save $4,000 per year in labor costs. If ou
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Answer:

NO

Explanation:

Discounted payback calculates the amount of time it takes to recover the amount invested in a project from it cumulative discounted cash flows

For the machine to be accepted, the total amount invested should be recovered in three years or less

Amount recovered = - cost of the project + discounted value of the cash flow

Amount recovered in year 1 = -10,000 + (4000 / 1.12) = -6,428.57

Amount recovered in year 2= -6,428.57 - (4000/ 1.12^2) = -3239.74

Amount recovered in year 3=  -3239.74 + (4000/ 1.12^3) = -392.62

the project would not be accepted because the amount invested would not be recovered within 3 years

8 0
2 years ago
Jose visited a garage sale and found a baseball card collection which he believed was worth over $1,000. he bought the collectio
Effectus [21]

Wanda does not have to refund his money. Wanda never said the collection was worth 1000 dollars or wroth anything.  Jose assumed the value and paid the asking price. Wanda has no legal obligation to refund the money.

4 0
3 years ago
For each of the following pairs of firms, explain which firm would be more likely to engage in advertising.
lions [1.4K]

Answer:

The correct answers are:

a) Family owned restaurant

b) A manufacturer of cars

c) A company that invented a very comfortable razor

Explanation:

First of all, the family who owned a restaurant will be the one that would most likely engaged in advertising due to the fact that they provide a service that has to be known for the people of the community around the place and all the tourists that go that area, meanwhile the other familiy would obviously just sell its products to the better buyer that they could find.

Secondly, the manufacturer of cars would be the one that most likely engaged in advertising due to the fact that they found themselfs in a very competitive and oligopoly market that is the car market and therefore that they highly need to stand out their making them better than the ones from the competitors.

Finally, the company who invented a very comfortable razor would be the one who engaged more in advertising due to the fact that they known they have a better product that the rest of the competitors so they need to take advantage of that and make sure that the consumers know about it and with that they would sell more and therefore invest more in advertising as well.

7 0
3 years ago
Spencer wants to choose a career path that wouldn’t hold him to an office or laboratory. Which of the following career paths wou
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6 0
3 years ago
Cake is a product of the Chester company which is primarily sold in the Americas Budget segment. Chester starts to create their
alekssr [168]

Answer:

Cake demand next year=1,267,498 units

Explanation:

Y=I+G

where;

Y=cake demand next year

I=initial demand

G=growth demand

Meaning;

Cake demand next year=Initial demand+growth demand

where;

Initial demand=1,207,141 units

growth demand=5% of initial demand

growth demand=(5/100)×1,207,141=60,357.05 units

replacing;

Cake demand next year=1,207,141+60,357.05=1,267,498.05

Cake demand next year=1,267,498.05 units rounded off to the nearest unit=1,267,498 units

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