Micro Economics For Today
10th Edition
ISBN: 9781337613064
Author: Tucker, Irvin B.
Publisher: Cengage,
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Chapter 5, Problem 11SQP
To determine
To compare the income
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The consumer demand equation for tissues is given by q = (110 - p)2, where p is the price per case of tissues and q is the
demand in weekly sales.
(a) Determine the price elasticity of demand E when the price is set at $26. (Round your answer to three decimal places.)
E-0.619
Interpret your answer.
The demand is going down by 0.619
% per 1% increase in price at that price level.
(b) At what price should tissues be sold to maximize the revenue? (Round your answer to the nearest cent.)
$37
x
(c) Approximately how many cases of tissues would be demanded at that price? (Round your answer to the nearest whole
number.)
5329
X cases per week
The consumer demand equation for tissues is given by
q = 11,664 −216 p +p2,
where p is the price per case of tissues and q is the demand in weekly sales.
Determine the price elasticity of demand E when the price is set at $24. (Round your answer to three decimal places.)E =
consider public policy aimed at smoking. Studies indicate that the price elasticity of demand for cigarettes is about 0.4. If a pack of cigarettes currently cost $5 and the government wants to reduce smoking by 20%, it should increase the price by what %? If the government permanently increases the price of cigarettes, the effect on smoking 1 year from now will be blank than the effect 3 months from now. Studies also find that teenagers have a higher price
Chapter 5 Solutions
Micro Economics For Today
Ch. 5.3 - According to the previous discussion, what factors...Ch. 5 - If the price of a good or service increases and...Ch. 5 - Prob. 2SQPCh. 5 - Prob. 3SQPCh. 5 - Prob. 4SQPCh. 5 - Suppose a university raises its tuition from 3,000...Ch. 5 - Prob. 6SQPCh. 5 - Suppose a movie theater raises the price of...Ch. 5 - Charles loves Mello Yello and will spend 10 per...Ch. 5 - Prob. 9SQP
Ch. 5 - Prob. 10SQPCh. 5 - Prob. 11SQPCh. 5 - Prob. 12SQPCh. 5 - Prob. 13SQPCh. 5 - Consider the following supply schedule: What is...Ch. 5 - Prob. 15SQPCh. 5 - Prob. 16SQPCh. 5 - A perfectly elastic demand curve has an elasticity...Ch. 5 - Prob. 2SQCh. 5 - Prob. 3SQCh. 5 - Prob. 4SQCh. 5 - Price elasticity of demand tends to be larger in...Ch. 5 - If a decrease in the price of movie tickets...Ch. 5 - Prob. 7SQCh. 5 - The president of Tucker Motors says, Lowering the...Ch. 5 - Prob. 9SQCh. 5 - Along a segment of the demand curve where the...Ch. 5 - Prob. 11SQCh. 5 - Prob. 12SQCh. 5 - Prob. 13SQCh. 5 - Prob. 14SQCh. 5 - Prob. 15SQCh. 5 - Prob. 16SQCh. 5 - Suppose Sally buys exactly five bars of English...Ch. 5 - Prob. 18SQCh. 5 - Prob. 19SQCh. 5 - Prob. 20SQCh. 5 - If bus travel is an inferior good, its income...Ch. 5 - Prob. 22SQCh. 5 - If automobiles and gasoline are complements, then...Ch. 5 - Suppose that when price is 10, quantity supplied...Ch. 5 - Prob. 25SQ
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Similar questions
- Suppose that you observe that when the price of a particular vaccine falls by 4%, the quantity purchased____ by 2%. This implies that this vaccine is price in demand and that the price elasticity of demand is equal to ______ falls; elastic; 2 falls; inelastic; 0.5 rises; elastic; 2 rises; inelastic; 0.5arrow_forwardDiscuss what is known about price elasticities of demand for various health care services. Needs to discuss acute, chronic, well, dentristry; hospital; ambulatoryarrow_forwardSuppose the income elasticity of demand for furniture is 3 and the income elasticity of demand for physician services is 0.3. Compare the impact on furniture and physician services of a recession that reduces consumer income by 10%.arrow_forward
- Suppose that a study finds that the price elasticity of demand for MRI's is 0.3 (in absolute value). If the price of care were to ___ by 3%, we would expect the quantity of preventative care consumed to fall by ____%. Suppose that a study finds that the price elasticity of demand for MRI's is 0.3 (in absolute value). If the price of care were to ___ by 3%, we would expect the quantity of preventative care consumed to fall by ____%. a. fall; 0.3% b. rise; 0.9% c. rise; 0.3% d. fall; 0.9%arrow_forwardThe elasticity of demand for physician visits was determined to be -0.2. The president of the local insurance company wants to add a copayment of $0.50 onto each physician visit. Currently, there is no copay. The number of insured people is 3,000,000 and currently the population uses 2.4 visits per capita. How many visits will they use after the introduction of the copayment?arrow_forwardWhen is use of the arc elasticity concept valid as compared with the use of the point elasticity concept?arrow_forward
- Considering Healthcare price elasticity, would it be a good idea to implement a price increase on medical products?arrow_forwardConsider public policy aimed at smoking. Studies indicate that the price elasticity of demand for cigarettes is about 0.5. If a pack of cigarettes currently costs $5 and the government wants to reduce smoking by 30%, it should increase the price by . If the government permanently increases the price of cigarettes, the effect on smoking 1 year from now will be than the effect 5 years from now. Studies also find that teenagers have a higher price elasticity of demand than do adults. Which of the following statements are consistent with this result? Check all that apply. It is legal for adults to consume alcohol, so many choose to spend their money on that good rather than cigarettes. Adults are more likely to be addicted to cigarettes. Teenagers do not have as much income as adults, so they are more price sensitive.arrow_forwardWhat does income elasticity of demand mean for insurance companies and medical providers for making a decision?arrow_forward
- Suppose the income elasticity of demand for furniture is 3, and the income elasticity of demand for physician services is 0.3. A recession occurs in the global economy that reduces all consumers' incomes by 10%. Which of the following statements accurately describe the effect of the recession? Check all that apply. Purchases of furniture increase by 30%. Purchases of physician services decrease by 3%. Purchases of furniture decrease by 30%. Purchases of furniture decrease by 3%. Check Answer Save & Continue Continue without savingarrow_forwardConsider public policy aimed at smoking. Studies indicate that the price elasticity of demand for cigarettes is about 0.2. If a pack of cigarettes currently costs $5 and the government wants to reduce smoking by 10%, it should increase the price by . If the government permanently increases the price of cigarettes, the effect on smoking 1 year from now will be than the effect 3 months from now. Studies also find that teenagers have a higher price elasticity of demand than do adults. Which of the following statements are consistent with this result? Check all that apply. Teenagers do not have as much income as adults, so they are more price sensitive. It is legal for adults to consume alcohol, so many choose to spend their money on that good rather than cigarettes. Adults are more likely to be addicted to cigarettes.arrow_forwardBonus Question. Suppose that a consumer makes V0 physician visits each year at a price of P0. If the price elasticity is -0.4, what will happen to the number of visits if the price increases by 15 percent? What will happen to total physician expenditures? Explain your answers. Hint: take into account that physician expenditures is the same as a physician’s practice revenue. Also, consider the relationship of elasticity and revenues.arrow_forward
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