Question

Jos PC P BMAC 7.5 1.85 1.75 1.75 1.5! 1.35 1.25 1.25 10.55 10.45 10.35 10.3 10.3 10.25 10.25 10.25 10.25 10.25 10.25 10.2 10.15 1.25 1.2 3090 3059 3040 3039 2942 2934 2875 2870 2849 2842 2934 2821 2819 2791 2729 2721 2659 2633 2623 2586 2557 2517 2503 2502 1.15 23750 28444 28264 28259 27950 27350 27350 8.65 26850 8.65 26450 8.65 26350 8.65 26350 8.65 26200 8.65 26120 9.75 26120 9.75 26120 9.75 25970 9.75 25970 9.99 25950 9.99 25950 9.99 25750 9.99 25750 10.25 25700 10.25 25600 10.25 25500 9.04625 26419.4583 10.1 1.15 1.1 1.05 1.05 0.95 0.95 0.85 0.55 0.55 0.55 0.55 0.16 1.087916667 9.75 9.75 9.65 9.6 10.11875 Average

Answer 1

Point income elasticity = (oefficient * Aucrage I Aucoge Q * 26419.4583 2788.9583333 -0.007802248 = 0.073909733 Since Point Price elasticity we have - 0.29386 Renter of Relation between clocotic Clasticity and Total Revenue. when Price elasticity (21) if from increases Price , men Total Revenue increase s. Toto ut (reases. Increases it from decreases Prices, Then Total Revenue decreases How it works, when we have elasticity (Price elasticity) dess Thon one ana fiom increases Price then aue To inelastic demand quantity will not Change that much as a result TR increases. Similarly when from decreases the price.

(a) Point Price exoticity = -0.29386 < 1 so an increase in Price would result in decrease in increase in Total Revenue. (b) Point Price elasticity = -0.29386 . I So an decrease in Price coould result in decrease in Revenue. So an decrease in Price by 1% Leady to increase in quantity of Pizza by 0.294% Average PC = 9004625 1% of Average Pc = 0.0904625 0.0905 Average = 2788,9583 2789 0.294 6% of Average Bee = quantity = 8-19966 V 8.2 There Jose Average devence (Poice * quantity ) decreased by = 0.742069 23 ☆ 0.7421 So one / decrease in Price Leades To 0.7421 % decrecies in TR.