Principles Of Microeconomics
7th Edition
ISBN: 9781260111088
Author: Robert H. Frank, Ben Bernanke, Kate Antonovics, Ori Heffetz
Publisher: McGraw-Hill Education
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Chapter 4, Problem 4P
To determine
Calculate revenue maximizing price and show the inelastic region of the
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Suppose, while rummaging through your uncle's closet, you found the original painting of Dogs Playing Poker, a
valuable plece of art. You decide to set up a display in your uncle's garage. The demand curve to see this valuable
plece of art is as shown in the diagram below.
Instructions: On the graph below, use the drop-down menu to indicate whether demand is elastic, inelastic, or unit
elastic at each point.
Price ($/visit)
10
14
$
12
10
8
2
0
Demand for Dogs Playing Poker
1
Elastic
per visit.
2
Inelastic
3
4
Unit elastic
5 6 7
Quantity (visitors/day)
What price should you charge if your goal is to maximize your revenues from tickets sold?
Instructions: Enter your answer as a whole number.
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☆
Suppose, while rummaging through your uncle's closet, you found the original painting of Dogs Playing Poker, a valuable piece of art.
You decide to set up a display in your uncle's garage. The demand curve to see this valuable piece of art is as shown in the diagram
below.
Instructions: On the graph below, use the drop-down menu to indicate whether demand is elastic, inelastic, or unit elastic at each
point.
Price ($/visit)
14
12
10
∞o
4
2
O
Demand for Dogs Playing Poker
1
Select ▼
2
3
Select ▼
4
Select
5
Quantity (visitors/day)
6 7
Ⓡ
Assume that you work in a movie theater and you want to increase revenue at the theater after the pandemic. The pandemic has caused people to find many activities that are alternatives to going to the movie theater. Fill in the blanks below with the words that best complete the sentences:
Because consumers have found more substitutes for going to the movie theater, price elasticity of demand for movie tickets is more likely to be
[ elastic or inelastic ].
Because of this price elasticity of demand, you should [increase or decrease] the price of movie tickets if you want to increase revenue.
Chapter 4 Solutions
Principles Of Microeconomics
Ch. 4 - Prob. 1RQCh. 4 - Why does the price elasticity of demand for a good...Ch. 4 - Prob. 3RQCh. 4 - Prob. 4RQCh. 4 - Prob. 5RQCh. 4 - Prob. 1PCh. 4 - Among the following groupssenior executives,...Ch. 4 - Calculate the price elasticity of demand (in...Ch. 4 - Prob. 4PCh. 4 - Prob. 5P
Ch. 4 - Prob. 6PCh. 4 - Prob. 7PCh. 4 - A 2 percent increase in the price of milk causes a...Ch. 4 - What are the respective price elasticities of...Ch. 4 - The price elasticity of supply for basmati rice...Ch. 4 - Prob. 11PCh. 4 - What is the elasticity of demand for season ski...Ch. 4 - Prob. 4.2CCCh. 4 - Prob. 4.3CCCh. 4 - Prob. 4.4CC
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