HomeworkLib
Question

ESTIMATING DEMAND 3. You own a flower shop and you need to estimate demand for your...

ESTIMATING DEMAND
3.
You own a flower shop and you need to estimate demand for your services.
Assume the following:
Number of households in the market: 600,000
Average number of arrangements purchased per
household per year 4
Company’s estimate share of the total market 5%
SOLVE FOR THE FOLLOWING:
A. Total annual market demand 2,400,00
B. Estimated annual company demand 120,000
C. Estimated monthly company demand10,000
D. Estimated weekly demand2308
DEMAND ELASTICITY
4.
Using the information from ques. #3 , assume you will charge on average
$45.00 per arrangement. Calculate monthly revenue.
a) Assume you lower the average selling price to $40.00 per arrangement and
your monthly demand increases to 10,850 orders. Determine the elasticity of your demand. What can you infer about your market?
b) Assume you lower the average selling price to $40.00 per arrangement
and your monthly demand increases 11, 300 orders. Determine the elasticity of your demand. What can you infer about your market?

I mostly need help with question 4 a & b
business   economics   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

Hi! Welcome to Chegg!

4.

Monthly revenue = 45 X 10000 = 450000

a. Elasticity is given as:

Inference: Market demand is inelastic at this point. Price should be raised to increase revenue.

b. Elasticity is given as:

Inference: Market demand is elastic at this point. Price should be reduced to increase revenue.

0 0
Add a comment
Know the answer?
Add Answer to:
ESTIMATING DEMAND 3. You own a flower shop and you need to estimate demand for your...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • I just need help with parts B and C, I know those answers are correct but...

    I just need help with parts B and C, I know those answers are correct but have no clue how to do them. Please show step by step! Thank you!:) A)   Assume the following:        Number of college students in the market:                       25,000        Average number of copies per student per year                     125        Your company’s estimated share of the total market               13% Total annual market demand                                                            3,125,000 Estimated annual company demand                                                     406,250 Estimated monthly demand                                                                    33,854 Estimated weekly demand                                                                        7,813 Given the following for your copy business:    Annual Expenses:...

  • pls help wirh parts c, d, e, f, g, h and with monthly revenue! in a...

    pls help wirh parts c, d, e, f, g, h and with monthly revenue! in a time crunch! pls show all the work without excel! i'll be sure to thumbs up thank you in advance!!:) mes New... 14 v AA Аа у PO I U ab X X ALA Paragraph Styles Dicta 1. You own a Jeans manufacturing business. A) Assume the following: Number of consumers in the market: 1,720,300 Average number of jeans purchased per Consumers per year Company's...

  • i just need to know part C, regarding total cost, where did the .18 come from?...

    i just need to know part C, regarding total cost, where did the .18 come from? the answers in the paper are correct 4. Suppose you own a copy business that targets college students. A) Assume the following Number of college students in the market: Average number of copies per student per year Your company's estimated share of the total market 25,000 125 13% SOLVE FOR THE FOLLOWING: Total annual market demand 25,000x12.5 = 3,129,000 Estimated annual company demand 3,125,000...

  • You produce Coco cola beverages. You estimate that the price elasticity of demand for your product...

    You produce Coco cola beverages. You estimate that the price elasticity of demand for your product is 2.7 (in absolute value). Coco cola currently sells for $2.50 per 20-ounce can. Some legislators are considering placing a $1.00 per can tax on your product. The OWL will be relatively ---------------------------- Tax revenue will be relatively ------------------------------------- Given the price elasticity of demand, your burden of the tax is likely to be relatively -_______________

  • All of the answers are correct, I just need to see how to do parts C-H,...

    All of the answers are correct, I just need to see how to do parts C-H, please show step by step! THANK YOU! I'll be sure to thumbs up!:) A)   Assume the following:        Number of college students in the market:                       25,000        Average number of copies per student per year                     125        Your company’s estimated share of the total market               13% SOLVE FOR THE FOLLOWING: Total annual market demand                                                            3,125,000 Estimated annual company demand                                                     406,250 Estimated monthly demand                                                                    33,854 Estimated weekly demand                                                                        7,813 B)  Given the following for your copy business:...

  • You produce Coco cola beverages. You estimate that the price elasticity of demand for your product...

    You produce Coco cola beverages. You estimate that the price elasticity of demand for your product is 2.7 (in absolute value). Coco cola currently sells for $2.50 per 20-ounce can. Some legislators are considering placing a $1.00 per can tax on your product.(the answer should be a few words) 1-The DWL will be relatively 2-Tax revenue will be relatively 3-Given the price elasticity of demand, your burden of the tax is likely to be relatively

  • You estimate you need to supplement your social security payments with monthly withdrawals of $1,210.00 per...

    You estimate you need to supplement your social security payments with monthly withdrawals of $1,210.00 per month from a private investment account during the first 21 years of your retirement. Assuming you can earn annual returns of 5.5% in your investment account during your retirement years, how much money do you need to have accumulated in your investment account by the day you retire in order to fund the aforementioned monthly withdrawals?

  • 2-3 You estimate you will need S1,200,000 to live comfortably when you retire. a. Assuming you...

    2-3 You estimate you will need S1,200,000 to live comfortably when you retire. a. Assuming you will retire in 40 years, how much will you need to invest each year (in equal annual amounts) to reach your goal if your average annual return on investment is 10%? b. How much per year if your return is 2% per year?

  • 1) The estimated Canadian processed pork demand and supply functions are as the follow- ings: 100-3p+3...

    1) The estimated Canadian processed pork demand and supply functions are as the follow- ings: 100-3p+3 p 5 p+2 Y Qs=100+6p- 8 Ph where Q is the quantity in million kilograms (kg) of pork per year; p is the dollar price per kg, Pb is the price of beef per kg, Pe is the price of chicken per kg, Ph is the price of hogs per kg, and Y is the average income in thousand dollars. Suppose that p, $8.00...

  • You have been hired as a marketing consultant to Big Book Publishing, Inc., and you have...

    You have been hired as a marketing consultant to Big Book Publishing, Inc., and you have been approached to determine the best selling price for the hit calculus text by Whiner and Istanbul entitled Fun with Derivatives. You decide to make life easy and assume that the demand equation for Fun with Derivatives has the linear form q = mp + b, where p is the price per book, q is the demand in annual sales, and m and b...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT