5. Assume that we have estimated a demand curve for a particular brand of car. Using...

5. Assume that we have estimated a demand curve for a particular brand of car. Using a diagram, show the potential impacts of the following: (a) a rise in the price of petrol; (b) a rise in the price of the car; (c) a fall in the price of the car; (d) a general rise in incomes; (e) the invention of a water-powered car; (f) the introduction of a new model by a competing car manufacturer. (g) an advertising campaign by a competing car manufacturer;

6. Assuming that we have estimated a supply curve for a particular brand of car. Using a diagram, show the potential impacts of the following: (a) a rise in the price of cars; (b) a rise in the price of labor; (c) an increase in the price of iron ore; (d) a fall in the price of cars. (e) the introduction of a road congestion levy in all major cities; (f) an improvement in car manufacturing technology that enables each car to be produced more cheaply;

Expert Solution

Rahul Sunny answered 2 years ago

Question 5: Assume the following demand curve: Q = 50,400 – 1,200(P). Variable costs are estimated...

Question 5: Assume the following demand curve: Q = 50,400 – 1,200(P). Variable costs are estimated to be $25.78. Calculate total contribution margin at the optimal price. Round your answer to the nearest dollar. Question 6 Assume the following demand equation: Q = 797 - 19(P). Variable costs = $6. Calculate marginal revenue for the 251st unit. Round your final answer to the nearest dollar. (When you are calculating the two prices, do not round to less than 2 decimal...

A department store has estimated the demand curve for a popular brand of women’s dress shoes...

A department store has estimated the demand curve for a popular brand of women’s dress shoes as a function of price. Use the table to answer the question that follow. Points Price per pair Dress shoe sales per week A RO 18 100 B RO 15 200 C RO 12 300 D RO 9 400 E RO 6 500 F RO 3 600 Calculate demand elasticity between points A and B, between points C and D, and between points E...

In the Managerial Solution, we estimated a focus group's demand curve for iTunes downloads. The estimated...

In the Managerial Solution, we estimated a focus group's demand curve for iTunes downloads. The estimated coefficient on price was negative 413−413, and the t-statistic was negative 12.8−12.8. Using these values, what is the standard error of this estimated coefficient? The standard error of the price coefficient is 32.2732.27. (Enter your response rounded to two decimal places.) Suppose we had another focus group sample, ran a regression on that sample, and obtained the same coefficient on price but with a...

The demand function for your brand X shirts is estimated as Qdx = 1,000 - 5...

The demand function for your brand X shirts is estimated as Qdx = 1,000 - 5 Px - 10 Py + 9 PZ+ 0 .001 I The price of X is $ 10, Y is $ 4, Z is $ 10 and incomes are $ 20,000. 1) What are your sales? ______________ 2) What is the elasticity of demand for X? _______________ 3) What is the cross elasticity between X and Y? ______________ 4) Are...

Explain the demand curve, using an example of a particular good or service. Describe the difference...

Explain the demand curve, using an example of a particular good or service. Describe the difference between a change in the quantity demanded--movement along the curve--and change in the overall demand--shifting of the curve itself.

The annual demand function for a particular motor car is estimated as: D = 16000-10P/3+ Y2/1000...

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Assume the following demand curve: Q = 50,400 – 1,200(P). Variable costs are estimated to be $25.10

Assume the following demand curve: Q = 50,400 – 1,200(P). Variable costs are estimated to be $25.10. Calculate total contribution margin at the optimal price. Round your answer to the nearest dollar.5 - Assume the following demand equation: Q = 729 - 21(P). Variable costs = $6. Calculate marginal revenue for the 251st unit. Round your final answer to the nearest dollar.(When you are calculating the two prices, do not round to less than 2 decimal places. In other words,...

Suppose that in a particular market, the demand curve is highly elastic, and the supply curve...

Suppose that in a particular market, the demand curve is highly elastic, and the supply curve is highly inelastic. If a tax is imposed in this market, then the Question 25 options: buyers will bear a greater burden of the tax than the sellers. sellers will bear a greater burden of the tax than the buyers. buyers and sellers are likely to share the burden of the tax equally. buyers and sellers will not share the burden equally, but it...

the demand function for your brand x shirts is estimated as qd x = 1,000 -...

the demand function for your brand x shirts is estimated as qd x = 1,000 - 5 px - 10 py + 9 pz+ 0 .001 i the price of x is $ 10, y is $ 4, z is $ 10 and incomes are $ 20,000. 1) what are your sales? ______________ 2) what is the elasticity of demand for x? _______________ 3) what is the cross elasticity between x and z? ______________ 4) are x and...

The demand curve for grilled cheese sandwiches has been estimated using statistical techniques as follows: log(Q)...

The demand curve for grilled cheese sandwiches has been estimated using statistical techniques as follows: log(Q) = -1.10 - 0.18log(P) + 1.21log(I) + 0.84log(Ph) where Q is the quantity of grilled cheese sandwiches P is the price of grilled cheese sandwiches I is income Ph is the price of hamburgers. Thats all information a. If P = $1,000, calculate the price elasticity of demand b. Draw the Engel curve. (just show the shape, don’t need to show specific point) c....

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