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3 years ago

2. Explain what happens to the demand curve

Business

1 answer:

astraxan [27]3 years ago

5 0

Answer:

The law of demand states that consumers will request more of a product if its price decreases. For supplement goods, an increase in the price of one will increase demand for the other. The demand curve for apples will react as follows.

Explanation:

A). More people begin to prefer apples to oranges.

Should peoples' preference change to apples, the demand for oranges will decrease while that of apples will increase. The demand curve is downward sloping. If demand increases, the demand curve will shift to the right. It is also referred to as moving outwards. In this case, the demand curve for apples will shift to the right.

B) The price of peaches rises (because peaches are a substitute for apples).

Substitutes imply a good can be used in place of another. If the price of a substitute increases, it demands decreases. The demand for the substitute good will go up. An increase in the price of peaches will increase the demand for apples. As a result, the demand curve will shift outwards. In other words, shift to the right.

C. People's incomes rise (and apples are a normal good).

Demand for normal goods increase as the people's income rises. More people will afford to buy apples. If people are now earning more, the demand for apples will go up. The demand curve will shift to the right to indicate a surge in demand.

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Blake eats two bags of generic potato chips each day. Blake's hourly wage increases from $ 9 to $ 15 , and he decides to stop ea

Tasya [4]

Answer:

The income elasticity of demand for generic potato chips=-4.00

Explanation:

Elasticity of demand can be defined as a measure of how responsive the demand for a certain good is when the price of that good or service changes. The elasticity of demand is usually negative. A negative elasticity of demand implies that the demand of a good or service reduces with an increase in price. The elasticity of demand can be measured using different methods. The mid-point method will be used in this case. The mid-point method of calculating elasticity of demand is as shown;

E=%Q/%P

where;

E=elasticity of demand

%Q=percentage change in quantity demanded

%P=percentage change in the price

And;

%Q=[(Final quantity-Initial quantity)/{(Final quantity+Initial quantity)÷2}]×100

Final quantity=0

Initial quantity=2

replacing;

[(0-2)/{(0+2)÷2}]×100=(-2/1)×100=-200%

%P=[(Final price-Initial price)/{(Final price+initial price)÷2}]×100

%P=[(15-9)/{(15+9)÷2}]×100=(6/12)×100=50%

E=%Q/%P

replace for %Q and %P

E=-200%/50%

E=-4

The income elasticity of demand for generic potato chips=-4.00

5 0

3 years ago

You are the owner of a local Honda dealership. Unlike other dealerships in the area, you take pride in your "No Haggle" sales po

Nutka1998 [239]

The price that should be charge for a midsized automobile if you expect to maintain your record sales is $15,230.77.

Using this formula

Midsized automobile price = Marginal Cost (3×Elasticity) / 1 + (3 × Elasticity)

Let plug in the formula

Midsized automobile price = $11,000 (3× -1.2) / 1 + (3× -1.2)

Midsized automobile price = $14,000 × -4.8/ -3.8

Midsized automobile price = $14,000 × 1.384615

Midsized automobile price = $15,230.765

Midsized automobile price =$15,230.77 (Approximately)

Inconclusion the price that should be charge for a midsized automobile if you expect to maintain your record sales is $15,230.77.

Learn more here:brainly.com/question/16991499

3 0

2 years ago

The strong form of the efficient market hypothesis contends thatA) a select few institutional investors can earn abnormal profit

Anni [7]

Answer: Option D

Explanation: Strong form efficiency is the most stringent form of market efficiency. This hypothesis states that the securities in the market reflects all the information in their price whether public or private.

Therefore, any investor would not be able to earn abnormal returns no matter how much research he or she has done. As the securities reflects private information also, therefore, insider trading will also be useless.

Hence from the above we can conclude that the correct option is D.

5 0

3 years ago

The funds from operations (FFO) for a REIT is roughly equal to:

Mnenie [13.5K]

Answer: The correct answer is "Net income plus depreciation and amortization, excluding gains or losses from sales of property".

Explanation: The funds from operations (FFO) for a REIT is roughly equal to the Net income plus depreciation and amortization, excluding gains or losses from sales of property.

8 0

3 years ago

A company sells two products. Product A sells for $10.00 per unit and Product B sells for $8.00 per unit. Variable costs are $3.

Yuri [45]

Answer:

$6.55

Explanation:

A company sells two products. Product A sells for $10.00 per unit and Product B sells for $8.00 per unit. Variable costs are $3.00 for Product A and $2.50 for Product B. If the sales mix is 70% Product A and 30% Product B, the weighted average contribution margin is _____.

Step 1

Calculate Contribution per product = Selling Price - Variable Costs

Contribution for A = 10 - 3 = 7

Contribution for B = 8 - 2.5 = 5.5

Step 2

Multiply the Contribution per product by its sales mix

A = 7 x 70% = 4.9

B = 5.5 x 30% = 1.65

Step 3

Add up the weighted contribution margins for each product

Therefore the the weighted average contribution margin for both product is (4.9 + 1.65) = $6.55

4 0

2 years ago