Effect of changing supply on total revenue, Marketing Management

Problem: Elasticity, Total Revenue and Marginal Revenue

For Each of the following cases, what is the expected impact on the total revenue of the firm? Explain your reasoning

(a) Price elasticity of demand is known to be  0:5 and the firm raises price by 10%.
(b) Price elasticity of demand is known to be  2:5 and the firm lowers price by 5%.
(c) Price elasticity of demand is known to be  1:0 and the firm raises price by 1%.

Suppose the demand equation for good x was estimated as

QxD = 500 - 2Px:

(a) What is the price at which total revenue is maximized and what is the value of the total revenue at this point. Illustrate graphically.
(b) Identify the elastic and the inelastic ranges on the demand curve.

Problem : Effect of changing supply on total revenue (4 points)

Farm stories for July 26th, 2007. Written by Jim Birchard, Bayshore Broadcasting Corp. The largest winter wheat crop ever produced in Western Canada is set to begin harvesting this week. The Canadian Wheat Board says the 1.45 million acres seeded to the crop will  yield record production. Winter-wheat yields are on track to match or surpass last yearís record-setting yield results.

Based on the above excerpt, would you expect the income of the wheat farmers to increase or decrease? Explain with a demand-supply diagram.

Posted Date: 2/19/2013 5:57:48 AM | Location : United States







Related Discussions:- Effect of changing supply on total revenue, Assignment Help, Ask Question on Effect of changing supply on total revenue, Get Answer, Expert's Help, Effect of changing supply on total revenue Discussions

Write discussion on Effect of changing supply on total revenue
Your posts are moderated
Related Questions
2(cosx+cos2x)+sin2x(1+cos2x)=2sinx

Companies are forced to follow sales orientation because the results are measured in short term and incentives are based on short term achievements. This leads to a high level of r

How the product line appraisal is important task?

What are focus and drawback of product concept? Product Concept: Focus: The focus of the firms subsequent the product concept is onto the production of greater products

Explain about marketing network in relationship marketing. Relationship marketing has the intend of building manually satisfying long-term relationships along with key partie

what is being marketed and also give a example

What is the meaning of product concept? Meaning: Production concept is the philosophy which consumers will favor products which are available and highly affordable and whi

Above the line and below the line communication What has happened hence is that the promotional mix has developed such that original emphasis on heavyweight mass communication

What is Geographical Segmentation? Geographical Segmentation: In this segmentation, the market is divided through location as like nation’s states, regions, neighbourhood

Question 1 How does e-business differ from the traditional business mechanism? Question 2 Describe the six components of business models Question 3 What is virtual private ne