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violetleopard499Lv1

28 Sep 2019

When the price of the pizza was $10.00 for a medium pizza, students at a college consumed 400 pizzas per week. When the price of pizza increased to $30.00 for a medium pizza, students at a college consumed 100 pizzas per week. Calculate the price elasticity of demand for medium pizzas for the students. You must show your work to receive credit for your calculation. If the price of pizza increases by 1%, by what will the percentage change in quantity demanded of pizzas for the students?

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Chika IlonahLv10

28 Sep 2019

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Related questions

1. You own a pizza shop and you use both labor and capital to make your pizzas. Currently the marginal product of labor is 5 pizzas per hour, while the marginal product of you capital is 2 pizzas per hour. You pay your labour $10 per hour, and your capital costs you $5 per hour. The price of pizza is $2.50. Is you little shop using its inputs efficiently? Explain.

2. What is the difference between a profit and a rent? If a firm is interested in maximizing profits, why would it stay in an industry if profits are zero?

3. The âVintage Sistersâ collect old junk, fix it up, and sell it at craft fairs as a hobby. All of their costs are covered by their poor father who lets them use his shop, tools, and paint for free. When pricing their stuff, what elasticity of demand should they aim for? Why?

4. Solve for the equilibrium price and quantity (P* and Q*) both algebraically and graphically (using graph paper), for these four markets:

Market 1:

Q_D = 10 â P

Q_S = 5

Market 2:

Q_D = 10 â P

Q_S = 5 + P

Market 3:

Q_D = 10 â Â½ P

Q_S = 5 + 2 P

Market 4:

P = 10 â 2Q_D

Q_S = 1 + P

harlequinclam577

Please show the work:

1- Suppose price elasticity of demand of a pizza at the local pizza restaurant is setimated to be 4. by how much does the quantity of pizza sold change if the shop raises the price of pizza by 5%?

2- Suppose a local clothing estimates that the income of its customers has increased by 16%. This clothing store calculated income elasticity of demand to be 1.2. how much should the quantity demanded of clothes change based on this infomation? what does the income elasticity tell you about the goods this clothing store is selling?

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1. Which of the following is not characteristic of the demand for a commodity that is elastic?

a. The relative change in quantity demanded is greater than the relative in price

b. Buyers are relatively sensitive to price changes

c. Total revenue declines if price is increased

d. The elasticity coefficient is less than one

2. Suppose the price elasticity of demand for bread is 0.20 if the bread falls by 10 percent, the quantity demanded will increase by:

a. 2 percent and total expenditures on bread will rise

b. 2 percent and total expenditures on bread will fall

c. 20 percent and total expenditures on bread will fall

d. 20 percent and total expenditures on bread will rise

3. If a consumer is equilibrium, an increase in money income will:

a. Move him to a new equilibrium on a lower indifference curve

b. Make his indifferent curves steeper, but will not alter the equilibrium position

c. Have no effect on the equilibrium position because product prices have not change

d. Move him a new equilibrium on a high indifferent curve

4. The larger the coefficient of price elasticity of demand for a product, the:

a. Larger the resulting price change for an increase in supply

b. More rapid the rate at which the marginal utility of that product diminishes

c. Smaller the resulting price change for an increase in supply

5. A manufactures of frozen pizzas found that total revenue decreased when price was lowed from $5to $4. It was also found that total revenue decreased when price was raised from $5 to $6. Thus,

a. The demand for pizza is elastic above $5 and inelastic below $5

b. The demand for pizza is elastic both above and below $5

c. The demand for pizza is inelastic above $5 and elastic below$5

d. $5 is not the equilibrium price of pizza

6. The elasticity of demand for a product is likely to be greater

a. if the product is necessity, rather than a luxury

b. the greater the amount good of time over which buyers adjust to a price change

c. The smaller the proportion of one