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
How is the global sourcing of labour effective in competition international developments? Global sourcing of labour: Innovative uses of labour upon a global origin are e

Explain about the annual plan control in MIEV. Annual plan control: This manuscript includes all the governments numerical goals and managerial objectives. This is in fac

Competitive tourism and hospitality organisations strive to deliver a high level of service quality to their customers. As a Marketing Manager of one of these organisations, yo

case study questions to be answered.

What is personal selling? Explain the term in briefly. Personal Selling: Personal Selling is the communication technique in that sales people builds the personal relation

Importance of the marketing in a Seller's or Buyer's market : A seller's market is one in which the demand for goods and in the services exceeds to the supply. In such a situati

As risk manager, you are concerned about the additional liability exposure the firm will face if it accepts the project. you obtain an estimate of the annual total loss distributio

Creating Competitive Advantage In marketing two key trends for the twenty-first century are: (a) the trend toward the utilization of relationship marketing to develop customer

The percent of sales one product earns in relation to total market sales for all products in that category.

Two nights ago, an astronomer took a picture of a small portion of the sky containing 10,000 stars. Last night, the astronomer took a picture of the same portion of sky (containi