Suppose the inverse demand curve for drugs is p(q) = 200 - 4q and the inverse supply curve is p(q) = q. Draw the supply and demand curves on the graph below. Label the current price and quantity, label and calculate the current producer and consumer surplus, and calculate and label the total revenue accumulating to suppliers in this market.
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- Use the following information to calculate the elasticity of demand for primary care visits: initially a clinic visit cost $25 per visit and the clinic saw approximately 60 people per day. The clinic decided to raise price to $35 per visit and the number of people using the clinic fell to 50 people per day. Calculate the price elasticity of demand and indicate whether increasing the price was a good business decision.Taxicab fares in most cities are regulated. Several years ago, taxicab drivers in Boston obtained permission to raise their fares 10 percent, and the anticipated revenues would increase by about 10 percent as a result. They were disappointed, however, when the commissioner granted the 10% increase, revenues only increase about 5%. What can you infer about the elasticity of demand for taxi cab rides? What were taxicab drivers assuming about the elasticity of demand?Energy markets, such as the market for natural gas and electricity, have been known to be characterized by inelastic demand. However, recent research discussed in the August 25, 2022 issue of The Economist, indicates that while the responsiveness of quantity demanded in response to price changes indeed is “inelastic” (i.e., the absolute value of price elasticity of demand is still less than 1), the percentage change in quantity demanded in response to a change in price is much larger than earlier research indicated. Answer these narrative questions. No graphs are needed. What does “inelastic demand” formally mean? In addressing this part of the question, please make sure to explain the concept of the price elasticity of demand using a simple formula and by providing a short narrative. Policymakers are encouraging people to conserve energy in response to the growing energy crisis. Discuss the positives (pros) and negatives (cons) of providing subsidies to consumers in this situation…
- Suppose you can separate consumers into two groups: Group 1 has a price elasticity of demand = -3 and group 2 has a price elasticity of demand of -9. If you could conduct third-degree price discrimination, which group would you charge a higher price to? Why? What would be the relative price of group 1 to group 2? Suppose that the profit-maximizing price for group 2 is $12. What price should I charge group 1? Show all your work.Please answer this question asap I will rate you for sure. Answer must be in typed format Suppose that as the price of Y falls from $3.00 to $2.80, the quantity of Y demanded increases from 200 to 210 . Then the absolute value of the price elasticity (using the midpoint formula ) is approximately.In 4-6 sentences, discuss how understanding the concept of price elasticity of demand is useful for a business owner/firm operating in any market structure.
- Calculate the price elasticity of demand for healthcare in Japan using on data from year 2000. Region Outpatient visits Price/ visit Tokyo 1.0/ month 30 Hokkaido 1.2/ month 15In her spare time, your colleague is selling hand-carved wooden boxes on Etsy. The boxes are currently priced at $30/box. Your colleague is not happy with their current revenue stream and asks for your advice. You estimate that demand for your colleague's hand-carved wooden boxes is: Q = 800-20P. If your colleague is looking to maximize revenue, how should they price their wooden boxes? Keep prices at $30/box Lower prices to $20/box Raise price to $40/box Lower price to $25/box Raise prices to $35/boxPrice P₁ 15 P 0 Price P₁ Po 0 (a) Perfectly Elastic A с (c) Relatively Inelastic D Quantity Quantity Price P Te 0 Price P₁ P₂ 0 (b) Relatively Elastic B D (d) Perfectly Inelastic D Quantity Quantity Which graph would describe the demand for Insulin [Select] Which graph would describe the demand for a $1 bill [Select] Which graph would describe the demand for gas [Select]
- Your friend is a talented artist. She has no other employment options, she finds painting effortless, and the cost of materials is low enough that it can be safely ignored. Based on your analysis of market data, you estimate that elasticity of demand for her paintings is given in the displayed table. If your friend wants to maximize her income, what price do you advise her to charge for her paintings? Include a brief explanation. (If you think you can only determine a price range, as opposed to a precise price, give a price range.)Joe initially charged $180 for a electronic product and averaged 20 clients per week. When he raised his price to $220, the number of sales decreased to 15 per week. What is the price elasticity of demand for his product? Majed initially charged $50/hr. for helping with practice questions and averaged 35 clients per week. When he raised his price to $75, the number of sessions increased to 40 per week. What is the price elasticity of demand for his services?Question 1A manager of a nightclub realizes that demand for drinks is more elastic among students and is trying to determine the optimal pricing schedule. Specifically, he estimates the following average demand for his customer types: Under 25: q^r=18-5pOver 25: q=10-2p The two age groups visit the nightclub in equal numbers on average. Assume that drinks cost the club $2 to make. 1. If the manager cannot identify to which group his customers belong, what is the uniform monopoly price? 2. If the manager can identify to which group his customers belong, what price will he charge each group. Assume the manager can only charge a single price to each group 3. If the manager can charge a separate entry fee and a price per drink for each group, what two-part price will the manager set for reach group. 4. Now suppose that once again it is impossible to identify which group the customers belong. Suppose the manager lowers the price of drinks to equal to marginal cost and still wanted to…