ASAP Pls! Will thumb up! 123Which one is NOT correct?Elasticity refers to how much one variable responds to changes inanother variablePrice elasticity of demand is defined as the percentage change indemand divided by the percent change in price.When demand is elastic, a price increase causes revenue to fall.When demand is inelastic, a price increase does not affect revenue.Which one is NOT correct?For substitute goods, cross-price elasticity is greater than 0For complementary goods, cross-price elasticity is less than 0For complementary goods, a user's value from consuming both is greaterthan the sum of her values from consuming each aloneKodak used to sell cameras at a loss and make money from film. Thisstrategy is to take advantage of the substitutive relationship betweenthe two productsA decade after file sharing and piracy, revenues from concerts wereincreasing for most artists. This fact shows thatBefore file sharing, concerts and music CD were substitutes.After file sharing, concerts and music CD were substitutes.Free recorded music that people obtained through piracy is thecomplement for live concertsThe increase in CD price due to piracy lead to the increase in concertdemand

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2 Which one is NOT correct? Elasticity refers to how much one variable responds to changes in another variable Price elasticity of demand is defined as the percentage change in demand divided by the percent change in price. When demand is elastic, a price increase causes revenue to fall. When demand is inelastic, a price increase does not affect revenue.

2 Which one is NOT correct? Elasticity refers to how much one variable responds to changes in another variable Price elasticity of demand is defined as the percentage change in demand divided by the percent change in price. When demand is elastic, a price increase causes revenue to fall. When demand is inelastic, a price increase does not affect revenue.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter3: Demand Analysis

Section: Chapter Questions

Problem 8E: The Stopdecay Company sells an electric toothbrush for $25. Its sales have averaged 8,000 units per...

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Economists define normal goods as having a positive income elasticity. We can divide normal goods into two types: Those whose income elasticity is less than one and those whose income elasticity is greater than one. Think about products that would fall into each category. Can you come up with a name for each category?
According to the previous discussion, what factors influence the price elasticity of demand for cigarettes? What other factors not mentioned in the article might influence the price elasticity of demand for cigarettes?
Would you expect supply to play a more significant role in determining the price of a basic necessity like food or a luxury like perfume? Explain. Hint: Think about how the price elasticity of demand will differ between necessities and luxuries.
Why is the supply curve with constant unitary elasticity a straight line?
What does a price elasticity of demand of 0.39 mean?
Suppose you could buy shoes one at a time, miter than in pain. What do you predict the cross-price elasticity for left shoes and right shoes would be?
Explain why using the midpoint formula for calculating the elasticity of demand gives the same result whether price increases or decreases, but using the initial price and quantity instead of the average does not.
The price elasticity of demand for personal computers is estimated to be 2.2. If the price of personal computers declines by 20 percent, what will be the expected percentage increase in the quantity of computers sold?
The Stopdecay Company sells an electric toothbrush for $25. Its sales have averaged 8,000 units per month over the past year. Recently, its closest competitor, Decayfigh ter, reduced the price of its electric toothbrush from $35 to $30. As a result, Stopde cays sales declined by 1,500 units per month. What is the arc cross elasticity of demand between Stopdecays toothbrush and Decayfighters toothbrush? What does this indicate about the relationship between the two products? If Stopdecay knows that the arc price elasticity of demand for its toothbrush is 1.5, what price would Stopdecay have to charge to sell the same number of units as it did before the Decayfighter price cut? Assume that Decayfighter holds the price of its toothbrush constant at $30. What is Stopdecays average monthly total revenue from the sale of electric toothbrushes before and after the price change determined in part (b)? Is the result in part (c) necessarily desirable? What other factors would have to be taken into consideration?
What is the formula for line cross-price elasticity of demand?
Isabella always spends $50 on red roses each month and simply adjusts the quantity she purchases as the price changes. What can you say about Isabella's elasticity of demand for roses?
Maria has decided always to spend one third of her income on clothing. a. What is her income elasticity of clothing demand? b. What is her price elasticity of clothing demand? c. It Marias tastes change and she decides to spend only one fourth of her income on clothing, how does her demand curve change? What is her income elasticity and price elasticity now?