The price for cable in your neighborhood has risen from $24 to $30 per month, and the

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The price for cable in your neighborhood has risen from $24 to $30 per month, and the quantity demanded decreases from 204,000 to 196,000 subscribers.

a. Calculate the percentage change in the price of cable.

b. Calculate the percentage change in the quantity demanded by subscribers.

c. Based on these calculations, is the demand for cable elastic or inelastic?

d. What is the change in revenue for the cable service providers?

e. Now explain why the concept of price elasticity of demand is useful.

Related Book For answer-question

Managerial Economics and Organizational Architecture

ISBN: 978-0073375823

5th edition

Authors: James Brickley, Jerold Zimmerman, Clifford W. Smith Jr

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Posted Date: Feb 24, 2024 12:51 AM

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The price for cable in your neighborhood has risen from $24 to $30 per month, and the

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Solving the Cable Price and Demand Problem a Percentage change in price Price increase 30 24 6 Perce... View the full answer

Managerial Economics and Organizational Architecture

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