Problem 17.3 A proposal has been advanced to limit advertising of pharmaceutical prices to prevent unfair pricing
Fantastic news! We've Found the answer you've been seeking!
Question:
Problem 17.3
A proposal has been advanced to limit advertising of pharmaceutical prices to prevent unfair pricing by national chains. You estimate that limits on price advertising will change the price elasticity of demand from 5.63 to 4.43. The marginal cost of a typical prescription is $40. Atypical small pharmacy fills 25 prescriptions per day. A typical consumer fills20 prescriptions per year. What economic effects will the limit have on consumers and on pharmacists? Which group is likely to be the more effective advocate for its position?
Please show worked problem with explanation
Related Book For
Engineering Economy
ISBN: 978-0132554909
15th edition
Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Posted Date: