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2 years ago

For product X, the price elasticity of demand has an absolute value of 3.5. This means that quantity demanded will increase by

Business

1 answer:

cluponka [151]2 years ago

5 0

It means that quantity demanded will increase by 3.5% for every 1% decrease in price.

<h3>What is the price elasticity of demand?</h3>

Price elasticity of demand measures the percentage change in quantity demanded when the 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. When price increases, quantity demanded decreases by more of than the percentage change in price. When price increases, the quantity demanded declines.

To learn more about price elasticity of demand, please check: brainly.com/question/18850846

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Which of the following questions is an example of macroeconomics?

alex41 [277]

Answer:

C. If federal taxes are decreased will consumer spending increase?

Explanation:

One keen question that falls under the domain of macroeconomics is the behavior of consumer spending when taxes are decreased.

Macroeconomics presents approaches the study of the economy in a holistic way.
Every aspect of the economy is considered before strategic economic decisions are taken.
Interest rates, inflation, unemployment rate, foreign trade etc. are all categorized under macroeconomics.

8 0

3 years ago

For fixed-rate bonds it's important to realize that the value of the bond has a(n)-Select relationship to the level of interest

pogonyaev

Answer:

Answer is explained in the explanation section below.

Explanation:

It's necessary to remember that the value of fixed-rate bonds is inversely proportional to the level of interest rates. The value of the bond decreases as interest rates rise; moreover, the value of the bond rises as interest rates fall. A Bond with a lower coupon sells for less than its face value. When the going rate of interest is higher than the coupon rate, this condition arises. The value of the asset would increase over time. A higher coupon bond is one that sells for a higher price than its face value. When the going rate of interest is lower than the coupon rate, this condition arises. Its value will gradually decrease until it reaches its maturity value. A par value bond that sells at par, with a coupon rate equal to the current interest rate. The coupon is usually set at the going market rate on the day the bond is sold, so it sells at par at first.

Calculations:

C = Coupon Payments = $60 (Par Value x Coupon Rate)

n = number of years = 10

i = market rate or required yield = 7% = 0.007

K = number of coupon payments in 1 year = 1

P = value at maturity or par value = 1000

Present value of ordinary annuity formula:

Bond Price = C/k * $[\frac{1 - \frac{1}{(1 + \frac{i}{k})^{nk} } }{\frac{i}{k} } ]$ + $\frac{P}{(1 + \frac{i}{k})^{nk} }$

Just plug in the values and you will get:

Bond Price = 60 x 7.02 + 508.35

Bond Price = 421.41 508.35

Bond Price = $929.76

Similarly,

Data:

C = Coupon Payments = $60 (Par Value x Coupon Rate)

n = number of years = 10

i = market rate or required yield = 7% = 0.007

K = number of coupon payments in 1 year = 2

P = value at maturity or par value = 1000

Present value of ordinary annuity formula:

Bond Price = C/k * $[\frac{1 - \frac{1}{(1 + \frac{i}{k})^{nk} } }{\frac{i}{k} } ]$ + $\frac{P}{(1 + \frac{i}{k})^{nk} }$

Just plug in the values and you will get:

Bond Price = 30 x 14.21 + 502.57

Bond Price = 426.37 + 502.57

Bond Price = $928.94

8 0

3 years ago

Which of the following is an example of good organizational skills ?

Lina20 [59]

D. Know ahead of time what the teacher expects of you.

8 0

4 years ago

Gulf Shores Inn is comparing two separate capital structures. The first structure consists of 300,000 shares of stock and no deb

tangare [24]

Answer:

The price per share of equity is $37.083

Explanation:

The first capital structure is purely equity based and Guld Shores will sell 300000 shares at price x to raise the needed capital.

The second structure is a mixed or leveraged structure where both debt and equity components are involved. The capital that needds to be raised remains constant.

Gulf has to give up 300000 - 252000 = 48000 shares and raise 1.78 million dollars from debt. We assumed that the amount that Gulf will raise is the ame from both th structures. Then 48000 shares at price x are equal to $1.78 million debt.

So, Price per share of equity is,

1,780,000 = 48000x

1780000 / 48000 = x

x or price per share = $37.083

6 0

4 years ago

The difference between a job shadow and an internship is

Brilliant_brown [7]

A job shadow is usually very short term and involves following someone around to observe their work. An internship is usually a month or longer and is more formalized.

8 0

3 years ago

Read 2 more answers