Calculate the optimal price for papa burgers

Assignment Help Microeconomics
Reference no: EM13124357

Last week, Wally's Burgers, Inc. reduced the average price on the ½-pound Papa burger by 1%.In response, sales jumped by 2%.

A.) Calculated the point price elasticity of demand for Papa burgers.

B.) Calculate the optimal price for Papa burgers if marginal cost is $1 per unit.

The following relations describe demand and supply conditions in the lumber/forest products industry:

Qd= 75,000-10,000P (Demand)

Qd=-15,000+50,000P (Supply)

Where Q is quantity measured in thousands of board feet (one square foot lumber, one inch thick) and P is price in dollars.

A. Complete the following table:

Price

(1)

Quantity

Supplied

(2)

Quantity

Demanded

(3)

Surplus (+) or

Shortage (-)

(4)=(2)-(3)

$ 3.00

 

 

 

2.50

 

 

 

2.00

 

 

 

1.50

 

 

 

1.00

 

 

 

B.)What is the price and quantity in equilibrium?

Reference no: EM13124357

Questions Cloud

Calculate dobbs total standard cost per unit : Manufacturing overhead: Overhead is applied at a rate of $6 per direct labor hour. Calculate Dobbs's total standard cost per unit. (Round computations and final answer to 2 decimal places
Explain poisson kernel and harmonic function : Poisson Kernel and Harmonic Function, Let P_r(t)=R((1+z)/(1-z)), z=re^it be the Poisson kernel for the unit disc |z|
Amount of the finance charge : The customer fails to pay the bill within 30 days and a finance charge is added to the customer's account. What is the amount of the finance charge?
Simultaneous linear equations in two variables : A landscaper wants to combine golden landscape rock with rust-colored landscape rock to make a mix. The golden rock costs $0.59 per pound and the rust-colored rock cost $0.49 per pound.
Calculate the optimal price for papa burgers : Calculated the point price elasticity of demand for Papa burgers and calculate the optimal price for Papa burgers if marginal cost is $1 per unit.
Essential meaning of the grammatical structure : Devise concept questions to check student understanding of the sentences. Write 3 or 4 questions to each sentence. Make sure all your questions are useful, i.e. they check the essential meaning of the grammatical structure.
The arc price elasticity implied by the initial response : Calculate the arc price elasticity implied by the initial response to Z-Best's price increase and calculate the effective price reduction resulting from the coupon promotion.
Exploration of "race and ethnicity in the melting pot : The essay question is here: Write an essay in which you discuss a central theme to our exploration of "Race and Ethnicity in the Melting Pot". Use works by two of the following writers to support your ideas, as well as deepen your discussion: Baldwin..
Linear equations in business : Why is it important to understand linear equations in business? In particular can you provide examples where the relationship between items that can be affected by management and 'items' that management wished to achieve or attain may be 'linear'?

Reviews

Write a Review

 

Microeconomics Questions & Answers

  What is an oligopoly

What is an "oligopoly" and why do they exist? Mention three or four oligopolies whose products you own or regularly purchase.

  Find best indifference curve and best affordable point

Assume you can only consume good X and Y out of abudget of $120. Your utility function is U = ln(X)+ln(Y ).

  Increase in chocolate syrup sales

A grocery store notices that the cross-price elasticity between ice cream and chocolate syrup is -.3. The store is advertising a sale with ice cream prices reduced by 20%.

  Cost minimizing combination of labor and capital

A manager hires labor and rents capital equipment in a competitive market. The current wage is $6.00 per hour and capital is rented at $12.00 per hour.

  Firm demand for labour curve

Assume a firm's production function is given by Q = 12L - L^2 for L = 0 to 6, where L is labour input per day and Q is output per day. Derive and draw the firm's demand for labour curve if output sells for $10 in competitive market.

  Define analytically the firms strategies

What is the condition that δ has to satisfy in order for the collusion to be sustained in both states and which can be sustained in equilibrium and gives the highest intertemporal profit?

  Relation between average product and average variable cost

What is the relationship between the average variable cost and marginal cost and relation between average product and average variable cost?

  Determining the cost of production

A fashion firm manufactures outfits using two inputs, design skills (L) and expensive materials (M). The cost of fabrication is small and might be ignored as a first approximation.

  Analysis of the hold up problem

What does the analysis of the 'hold up' problem contribute to the explanation of the size and scope of firms?

  Clarification of marginal cost

Demand for DVD rentals at a video store is described by the equation: Q= 4,000-500P, where Q denotes the number of DVDs rented per week and P is the rental price in dollars.

  Concept of relevant cost

Two partners who owns IT Business Solutions, a company supplying specialist software, operate out of an office in Fourways, Johannesburg but have discovered a vacant office building close to Sandton City.

  Determining short-run firm supply

Make a table showing Mankato's marginal cost of newsprint production. Find out the minimum price necessary for Mankato to supply one ton of newsprint?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd