Compute the price elasticity of demand for paint

Assignment Help Econometrics
Reference no: EM13231809

Suppose you are a painter, and the price of a gallon of paint increases from $3.00 a gallon to $3.50 a gallon. Your usage of paint drops from 35 gallons a month to 20 gallons a month. Perform the following:

Compute the price elasticity of demand for paint.

Decide whether the demand for paint is elastic, unitary elastic, or inelastic.

Reference no: EM13231809

Questions Cloud

Create a risk-free hedge portfolio can be created : Methods of using stocks and options to create a risk-free hedge portfolio can be created. Support your answer with examples of these methods being used to create a risk-free hedge portfolio.
Differences between muscle spasms ansmuscle spasticity : Discuss the difference between muscle spasms ansmuscle spasticity. Including causes, signs ans symptoms, treatmentindications
What is the total cost of a package of dog biscuits : Are any constraints redundant? If so, which one or ones? (d) What is the total cost of a package of dog biscuits using the optimal mix?
Define decongestant ephedrine hydrochloride : calculate the pH of a 1.06 x 10^-2 M solution of decongestant ephedrine hydrochloride if the pKb of its conjugate bas is 3.86
Compute the price elasticity of demand for paint : Suppose you are a painter, and the price of a gallon of paint increases from $3.00 a gallon to $3.50 a gallon. Your usage of paint drops from 35 gallons a month to 20 gallons a month. Perform the following Compute the price elasticity of demand fo..
What is the probability that second item will be defective : A production process is known to produce a particular item in such a way that 5% of these are defective. If two items are randomly selected as they come off the production line, what is the probability that the second item will be defective?
What is the roic : Variable costs cover such things as electricity and heat and run $1.25 per month for each square foot occupied. a. What is the ROIC? b. What would be the new ROIC if Oscar decides to charge rent of $5.00 per square foot per month?
How is the patient and affordable care act of 2010 : How is the Patient and Affordable Care Act of 2010 (the "Health Care Reform Act") likely to reshape financial arrangements between hospitals, physicians, and other providers if Medicare makes a single payment for all care received by a beneficiary..
How skill set an it sales manager or who think broader skill : How does the skill set of an IT Sales Manager differ from that of the technical manager? Who do you think has the broader skills set

Reviews

Write a Review

Econometrics Questions & Answers

  Determine what happens to the variance of the error term

suppose you are estimating a simple linear regression model. (a) If you multiply all the x values by 20, but not the y values, what happens to the parameter values beta1 and beta2 what happens to the least squares estimates b1 and b

  Determine the minimum attractive rate of return

A pallet recycler has offered to purchase pallets, which are of certain sizes and in good condition. The pallets that are in these sizes and in acceptable condition amount to half the scrapped pallets. The pallet recycler is offering to pay $1.00 ..

  Determine what is the current nominal rate of interest

The one-year real rate of interest is currently estimated to be 3 percent. The current annual rate of inflation is 2 percent, and market forecasts expect the annual rate of inflation to be 5 percent. Approximately, what is the current one-year nom..

  Illustrate the market for theater tickets

illustrate the market for theater tickets in the case of these two externalities. Again, label the demand curve, the social-value curve, the supply curve, the social-cost curve, the market equilibrium level of output, the efficient level of output..

  Compute the value of the test statistic

According to the Census Bureau, 3.20 people reside in the typical American household. A sample of 26 households in Arizona retirement communities showed the mean number of residents per household was 2.86 residents.

  Determine the expected cost with perfect information

the Advisability of which action to take depends on how the market will respond to the new product.If demand is high, then its worthwhile to make the extra investment for special facilities and equipment needed to produce the component internally.

  Solve these equations for the equilibrium values of c

Assume that the following equations characterize a large open economy: (1) Y = 5,000 (2) Y = C + I + G + NX (3) C = 1/2(Y - T) (4) I = 2,000 - 100r (5) NX = 500 - 500e (6) CF = -100r (7) CF = NX (8) G = 1,500 (9) T = 1,000where NX is net exports, CF ..

  What effect did reducing the requirements to get disability

Between 1984 and 2001, the U.S. government made it much easier to get disability payments and the number of disabled people more than doubled from 3.8 million to 7.7 million. Once on disability, citizens then count as "out of the labor force."

  Effect of education on earnings

As a natural experiment to estimate the effect of education on receivings, a researcher compares schooling and educational attainment of two groups of people.

  Compute the cost savings that the company makes per year

A high-tech company in the US can have one of the popular items made offshore at half the price of making them in the US. However, about 90% of the items made offshore will be returned within the warranty period of 1 year for repairs. The followin..

  What is the slope of budget line from trading with friday

Suppose that you are on a desert island and possess exactly 20 coconuts. Your neighbor, Friday, is a fisherman, and he is willing to trade 2 fish for every 1 coconut that you are willing to give him. Another neighbor, Kwame, is also a fisherman

  Find the equilibrium level of income

Find the equilibrium level of income (Y*). Construct an aggregate expenditures model showing this information. What happens to RGDP if government spending decreases by $5 billion? Provide specific numbers. Suppose this economy opens up to trade. If..

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