Exerting influence on price elasticities of supply-demand

Assignment Help Business Economics

Reference no: EM13869130

Elasticity shows the responsiveness of supply or demand to changes in price. What are the factors exerting influence on price elasticities of supply and demand?

Think of another good that you have purchased recently (or you could continue with the good you selected in TDA I). Be specific (e.g. is it breakfast cereal in general or Cheerio’s cereal specifically). If the price of this item increases, how would this affect the quantity of the good that you consume? Is the Demand for this good Price elastic or Price inelastic? Justify your classification by talking about the determinants of elasticity as they apply to this product. Say price is on the rise for this product and you are the manager of a store, would you be thrilled to be selling this product? Under what circumstances would you want to own a business that sells this product? In other words, how does an increase in price for this good affect your Total Revenue? Using specific examples, relate the concepts of Cross Elasticity and Income Elasticity to this product.

Reference no: EM13869130

Questions Cloud

Expenditures under the grant and its billing to the state : To receive reimbursement, the district must submit quarterly reports showing its expenditures. Its expenditures for the quarter September through November 2012 were $ 450,000. Prepare separate journal entries to record its expenditures under the g..

Find the best response function for each firm : Two identical firms compete in competition (Cournot competition) in the same market where the inverse demand is P(Q) = 100 − Q. The constant marginal cost of both firms is 10. Find the best response function for each firm. (b) What is the Cournot (si..

What are the optimal quantity and price given the tax : The monopolist from the previous problem now faces a specific tax of 20, τ = 20. What are the optimal quantity and price given the tax? Calculate the welfare loss from the tax.

Discuss how a constructed wetland system works to treat : Discuss how a constructed wetland system works to treat municipal wastewater

Exerting influence on price elasticities of supply-demand : Elasticity shows the responsiveness of supply or demand to changes in price. What are the factors exerting influence on price elasticities of supply and demand? Think of another good that you have purchased recently (or you could continue with the go..

Describe the greenhouse effect and its importance to life : Describe the greenhouse effect and its importance to life on earth

What is the unregulated monopolists optimal quantity : A monopolist faces an inverse market demand P(Q) = 200 − (1/2)Q and a marginal cost of MC(Q) = 20 + Q. What is the unregulated monopolist’s optimal quantity? What would an appropriate regulatory instrument to bring this market back to efficiency? Wha..

The percentage of completion method of accounting : Lark Corporation uses the percentage of completion method of accounting for construction contracts. At the end of the current year, Lark estimates that its costs to complete a project exceed the contract price, so that an overall loss on the contract..

Discuss the causes of water shortages : Discuss the causes of water shortages

User Account

All Pages