User Account

All Pages

Income elasticity for companies

Assignment Help Macroeconomics
Reference no: EM131198123

1. Your company's competitors has lowered it prices by 20%. Your staff economist has estimated that the the cross price elasticity between your product and the competitor's product is -1.2. The boss wants to know how this will affect your companies revenues (sales)?

2. The income elasticity for your companies product A is 0.5; for product B he income elasticity it is 1.2; and for product C the income elasticity is -1.2. The country is in a recession and personal income is forecasted to fall by 2.2%. What is the forecasted revenue (sales) impact on product A, B and C, respectively. Which product would do the best (by sales growth) by how much and why?

3. Your boss wants to increase total revenue by 15%. Your staff economist has estimated that the price elasticity is 0.8. Should the company raise or lower its prices and by how much to affect a 15% revenue increase?

Reference no: EM131198123

Questions Cloud

Explain the process you would use for referral : You have been meeting with Gerry who has been drinking excessively for some time. He has now come to a point where he feels he should 'do something about it'. You are aware that there is a rehabilitation service where he can go for help. Explain t..
Swot analysis and value chain analysis of under armour : Complete a SWOT analysis and a value chain analysis of Under Armour. How well has the company performed to stated strategic objectives or performance targets? Support your assessment with factual data. Compare the strengths, weaknesses, opportunities..
How might your example be viewed from outside your culture : Then I want you to explain the importance your example holds for your culture, and the importance it holds for making you who you are. Other questions to address are: How might your example be viewed from "outside" your culture? How does your exam..
Derive an expression for the instantaneous field current : Derive an expression for the instantaneous electromagnetic torque during a three phase short circuit at the terminals. Assume the stator terminals of the machine are initially open-circuited and the speed does not change during the fault.
Income elasticity for companies : The income elasticity for your companies product A is 0.5; for product B he income elasticity it is 1.2; and for product C the income elasticity is -1.2. The country is in a recession and personal income is forecasted to fall by 2.2%. What is the ..
Donate large amount of money for student scholarships : A generous university benefactor has agreed to donate a large amount of money for student scholarships. The money can be provided in one lump sum of $12 million in Year 0 (the current year), or in parts, in which $7 million can be provided at the end..
Explain why transfer prices based on total actual costs : ACC202 - MANAGEMENT ACCOUNTING Explain why transfer prices based on total actual costs are not appropriate as the basis for divisional performance measurement - Using the market price as the transfer price, calculate the contribution margin for both..
What is their short run cost of remodeling : Hannah and Sam run Moretown Makeovers, a home remodeling business. The number of square feet they can remodel in a week is described by the Cobb-Douglas production function Q = F(L,K) = 10L0.5K0.5, where L is their number of workers and K is units of..
Express the rotor voltage equations of an induction machine : Express the rotor voltage equations of an induction machine in the arbitrary reference frame with the electric transients neglected.

Reviews

Write a Review

Macroeconomics Questions & Answers

  Inflation targeting be a good policy

Why might it be difficult for the Fed to formally adopt inflation targeting?  Would inflation targeting be a good policy for the Fed in the present economic environment

  In using the taylor rule

In using the Taylor Rule as a guideline for monetary policy, what are the pros and cons of using forecasted values of inflation and output rather than observed values of these variables?

  Describe the present economic crisis situation in europe

Describe the present economic crisis situation in Europe.  Why has it been so difficult for the Europeans to find a solution to this problem?   Comment on what implications the crisis may have for the rest of the world if Europeans are not able to ag..

  Long-term federal government budget problems

Question:. Explain why there are long-term Federal government budget problems. Explain why the base-line forecast of the CBO is misleading.

  Derive and compare demand curve

Question based on Derive and compare demand curve,  Derive Ambrose's demand function for peanuts. How does it compare with Johnny's demand curve for peanuts?

  Problem based on utility function

Problem based on  Utility Function - Problem,  Answer and explain the following using a diagram which is completely labeled.

  Laffer curve : tax rate and tax revenue

Question based on Laffer Curve : Tax Rate and Tax Revenue,  Do raising tax rates necessarily raise tax revenue? What factors affect how tax revenue changes when tax rates change?

  Problem - income elasticity of demand

Problem - Income Elasticity of Demand,  Interpret the following Income Elasticities of Demand (YED) values for the following and state if the good is normal or inferior; YED= +0.5 and YED= -2.5

  Positive balance of payment

Question Positive Balance of Payment: "Things will look good for the US if we could just get to where we are consistently running a positive Balance of Payments."

  Effect of recession on the investment curve

Comment on the effect of a recession on the investment curve (only) and on the level of savings, investment, and the equilibrium real interest rate in the financial crisis that hits United States first starting in fall 2007.

  Affect of falling domestic investment on trade surplus and

How will a fall in domestic investment affect the trade surplus and net capital outflows in the domestic economy, the trade deficit and capital inflows in the rest of the world.

  Crises in the banking sector and bank run

Banking crises crisis decreases depositors' confidence in the banking system. What would be the effect of a rumor about a banking crisis on checkable deposits in such a country?

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +91-977-207-8620

Phone: +91-977-207-8620

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd