Think of a good or service with which you are familiar and for which there has been a recent change in quantity demanded because of a change (up or down) in price.

What is the good or service?

What is your best estimate of the original quantity demanded? New quantity demanded? (please explain your units carefully.) You don’t need to do research: these numbers can be a best “guess.”

What is your best estimate of the original price? New price? (please explain your units carefully.)

What is price elasticity of demand for this good or service? Please show your work.

How does this elasticity compare with others listed in the textbook?

Expert Solution

1. The good or service that can be considered in this case is Smartphones. Fall in the prices of Smartphones for the past few years has led to increase in the quantity demanded of Smartphones.

2. The original quantity demanded was 20 million and the new quantity demanded is 30 millon.

3. Original prices were cloase to $700 initially and now it has fallen to $528.

4. The price elasticity of demand = Percentage change in quantity demanded/ Percentage change in price = 50 / -24.5 = -2.04.

5. The above figure show that demand of the good is elastic.

Rahul Sunny answered 2 years ago

Think of a good or service with which you are familiar and for which there has...

Think of a good or service with which you are familiar and for which there has been a recent change in quantity demanded because of a change (up or down) in price.What is the good or service? What is your best estimate of the original quantity demanded? New quantity demanded? (please explain your units carefully.) You don’t need to do research: these numbers can be a best “guess.” What is your best estimate of the original price? New price? (please...

If you cut the price of your good or service to increase the quantity demanded by...

If you cut the price of your good or service to increase the quantity demanded by your consumers, is that going to be a good thing for your firm? Discuss and justify your answer. Consider two demand curves; on the left, demand for airline tickets by businesses, and, on the right, demand for airline tickets by vacationers. Let the initial price be $500 for each panel and let the price fall to $400. Choose a new quantity demanded for each...

According to the law of demand, if price increases, quantity demanded of a good or service...

According to the law of demand, if price increases, quantity demanded of a good or service will decrease or vice versa. Price elasticity of demand tells us how much quantity demanded will decrease when price increases or how much quantity demanded will increase if price decreases.On the other hand, according to the law of supply, if the price increases, quantity supplied of a good or service will increase. Similarly, if price decreases, quantity supplied will decrease. The degree of sensitivity...

• When a seller decides to change his price for a particular good, will quantity demanded...

• When a seller decides to change his price for a particular good, will quantity demanded change drastically? And what will happen to the total revenue, will it increase or fall? •Will individuals form teams or firms in all settings? •Economic profit is usually lower than accounting profit. A firm that makes zero economic profit is said to be earning normal profit. Is zero economic profit bad for a firm? •Discuss the difference between monopolistic competition and oligopoly. •What makes...

1,If the percentage change in quantity demanded of a good is less than the percentage change...

1,If the percentage change in quantity demanded of a good is less than the percentage change in buyer's income, then the good is said to be income unit elastic. income elastic. price elastic. price inelastic. income inelastic 2. Income elasticity of demand for good A is -0.22. Good A is income __________ and is a(n) __________ good. inelastic; inferior unit elastic; normal elastic; normal elastic; inferior inelastic; normal

At a price of $ 80, the quantity demanded of a given good is 200 units....

At a price of $ 80, the quantity demanded of a given good is 200 units. If the price decreases to $ 45, the quantity demanded increases to 225 units. 1. Calculate the value of the price elasticity. 2. Explain what type of claim it is. Explain in detail what managerial action corresponds to take, raise the price, lower it or leave it the same. 3. Make the graphic representation. 4. Answer correctly if it is elastic, inelastic or unitary,...

At a price of $ 80, the quantity demanded of a given good is 200 units....

At a price of $ 80, the quantity demanded of a given good is 200 units. If the price decreases to $ 45, the quantity demanded increases to 225 units. 1. Calculate the value of the price elasticity. 2. Explain what type of claim it is. Explain in detail what managerial action corresponds to take, raise the price, lower it or leave it the same. 3. Make the graphic representation. 4. Answer correctly if it is elastic, inelastic or unitary,...

21. When consumers respond to a price change but the percentage change in quantity demanded (in...

21. When consumers respond to a price change but the percentage change in quantity demanded (in absolute value) is smaller than the percentage change in price (in absolute value), the demand is described as being _______. Group of answer choices perfectly inelastic perfectly elastic inelastic unit elastic elastic 22. Assume that you manage a car wash, and you have previously calculated the price elasticity of demand to be 1.2 (in absolute value). To draw in more customers, you decide to...

What causes a change in Quantity Demanded? What is the difference between a Normal Good and...

What causes a change in Quantity Demanded? What is the difference between a Normal Good and an Inferior Good? Give an example of each. Why is the market system also referred to as the price system?

Think of a change in your own company or a company with which you are familiar....

Think of a change in your own company or a company with which you are familiar. Who were the stakeholders in this change? Discuss what concerns different stakeholders might have and how communication is needed to address those concerns.

Question

Think of a good or service with which you are familiar and for which there has been a recent change in quantity demanded because of a change (up or down) in price.

Solutions

Expert Solution

Related Solutions

Think of a good or service with which you are familiar and for which there has...

If you cut the price of your good or service to increase the quantity demanded by...

According to the law of demand, if price increases, quantity demanded of a good or service...

• When a seller decides to change his price for a particular good, will quantity demanded...

1,If the percentage change in quantity demanded of a good is less than the percentage change...

At a price of $ 80, the quantity demanded of a given good is 200 units....

At a price of $ 80, the quantity demanded of a given good is 200 units....

21. When consumers respond to a price change but the percentage change in quantity demanded (in...

What causes a change in Quantity Demanded? What is the difference between a Normal Good and...

Think of a change in your own company or a company with which you are familiar....