All categories

3 years ago

If the price elasticity of demand for a product is 2.5, then a price cut from $2.00 to $1.80 will:

Business

1 answer:

saul85 [17]3 years ago

5 0

Answer:

Explanation:

Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.

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

If the absolute value of price elasticity is greater than one, it means demand is elastic. Elastic demand means that quantity demanded is sensitive to price changes.

Demand is inelastic if a small change in price has little or no effect on quantity demanded. The absolute value of elasticity would be less than one

Demand is unit elastic if a small change in price has an equal and proportionate effect on quantity demanded.

Percentage change in price = (1.8 - 2) / 2 = -0.10

2.5 = percentage change in quantity demanded / -0.10

percentage change in quantity demanded = 0.10 x 2.5 = 0.25 = 25%

Because there was a decrease in price, demand would increase by 25%

You might be interested in

Kostelnik Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours

balu736 [363]

Answer:

The correct answer is B.

Explanation:

Giving the following information:

Estimated overhead= $285,600

variable manufacturing overhead= $2.70 per machine-hour

Estimated machine-hours= 42,000

Job A496:

Number of units in the job 20

Total machine-hours 80

Direct materials $910

Direct labor cost $1,820

First, we need to allocate overhead to Job A496:

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Estimated manufacturing overhead rate= (285,600/42,000) + 2.7

Estimated manufacturing overhead rate= $9.5 per machine hour

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Allocated MOH= 9.5*80= $760

Now, we can calculate the total cost:

Total cost= 910 + 1,820 + 760

Total cost= $3,490

Finally, we determine the unitary cost:

Unitary cost= 3,490/20= $174.5

5 0

3 years ago

Thompson argues that civil liberties thrive only when the public demands them and understands that they are at risk of losing th

nataly862011 [7]

Answer: A. True

Explanation:

Clive Thompson on Why the Next Civil Rights Battle Will Be Over the Mind shared the above.

According to C. Thompson he said "That means we need to stop seeing this stuff as science fiction and start thinking about how we'll react to it. Otherwise, we could all lose our minds."

8 0

3 years ago

When the housing market collapsed in 2007, the demand for loanable funds decreased and caused interest rates to decrease.

o-na [289]

It is False When the housing market collapsed in 2007, the demand for loanable funds decreased and caused interest rates to decrease.

Because Interest rates typically decline during recessions as loan demand slows, bond prices rise and the central bank eases monetary policy. During recent recessions, the Federal Reserve has cut short-term rates and eased credit access for municipal and corporate borrowers. No price in the economy is as important as the price of money. Interest rates arguably drive the business cycle of expansion and contraction.

Interest rate is the amount a lender charges a borrower and is a percentage of the principal the amount loaned.

Recession is a period when the business and industry of a country is not successful.

Corporate is formed into an association and endowed by law with the rights and liabilities of an individual.

To know more about the Interest Rate here

brainly.com/question/13324776

#SPJ4

4 0

1 year ago

31. In the United States, men most commonly have a longer life expectancy than women.

Minchanka [31]

I believe it’s False, it might be wrong though

5 0

2 years ago

Read 2 more answers

A(n) ____ is the transfer of the control of operations and management from one firm to another with the former becoming a unit o

olya-2409 [2.1K]

Answer:

acquisition

Merger

Explanation:

Acquisition is when a company purchases almost all the shares of another company in order to have full control over it. For companies that are distressed or are not able to operate as a going concern, such can put up the company for sale.

In acquisition, the buying company oftentimes retain its name which is already a brand , work and build on the strength of the old company in order to achieve returns. Companies acquire other companies in order to have large market shares and also to diversify their business operation.

One of the benefit of acquisition is that it gives room for fresh ideas due to coming together of different people and also brings people that are experts in their various fields.

Merger is when two or more firms comes together to form a single entity.

Companies or firm merge in order to form an alliance and also send strong signals to other competitors.

Firms also merge in order to increase their financial capacity. This will enable them to be able to finance their business operations. They are also able to increase their asset base as a result of the merger.

4 0

3 years ago