+1-415-670-9189
info@expertsmind.com
Franchise owner would like to increase the price
Course:- Business Economics
Reference No.:- EM13862639




Assignment Help
Expertsmind Rated 4.9 / 5 based on 47215 reviews.
Review Site
Assignment Help >> Business Economics

A specific McDonald’s franchise owner is looking at elasticities of Big Macs. E(p)= 2 (Price), E(i)=1 (Income), E(mt)=1.5 (m=Big Mac, t= Taco). The franchise owner would like to increase the price of Big Macs by 6%. The owner read an economic report saying incomes will grow by 4% next year and due to a strong marketing campaign by Taco Bell, the price of Tacos will fall by 2%.

If the franchise owner currently sells 1,200 Big Macs a day, how many Big Macs a day can the owner expect to sell?

If the owner wants to keep units sold the same at 1,200 per day, by what percentage must the owner change the price of Big Macs?




Put your comment
 
Minimize


Ask Question & Get Answers from Experts
Browse some more (Business Economics) Materials
Fannie Mae performed the useful function of increasing the liquidity of the secondary market of mortgage loans. Putting different mortgage loans in a pool for selling is alway
Consider a REIT that holds high quality office buildings in some of the best locations in the US. The REIT is currently traded at a price of $64/share and there are 70 million
Consider the Ricardian model. Home has 1200 unites of labor available. It can produce two goods, apples (A) and bananas (B). The unit labor requirement in apple production is
Suppose that the reserve requirement ratio is 4% and that the Fed uses open market operations (OMO) by BUYING $200 million worth of Treasury securities. Assume that banks use
K.T. Labs bought a Gene gun for $25,000. The accounting department has estimated that the machine would have an annualized capital cost of $3,880 over its 10-year service life
What influence did the elements of the Juran Trilogy have, if any, on the company's quality training curriculum? If the company does not have a quality curriculum, why do you
Use the following data to calculate (a) the size of the labor force, (b) the official unemployment rate, and (c) the labor force participation rate (defined in Ch. 3) for a hy
What can you say about the price elasticity of demand for DVD players. What will this price reduction necessarily lead to an increase in profits for DVD player manufacturers.