Question: In week 1, the low price manager cuts prices by 50%. In week 2, the high price manager raises prices by 50%, and so forth.

In week 1, the "low price" manager cuts prices by 50%. In week 2, the "high price" manager raises prices by 50%, and so forth. Suppose an item started out at $100.
A store has two managers, one who believes that high profits come from lowering prices and getting more customers and another who believes that high profits come from raising prices and making more profit per customer. These managers get to choose prices in alternate weeks. For each case,
a. Find the price after 1, 2, 3, and 4 weeks.
b. Find a formula for the price after t weeks (break into the two cases, t even and t odd).
c. Which of the managers wins?
d. What does this have to do with the geometric mean?

Step by Step Solution

★★★★★

3.32 Rating (158 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

a 50 75 3750 5625 b After an even number of weeks the price p t is p t 07... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

808-M-S-P (7654).docx

120 KBs Word File

Students Have Also Explored These Related Statistics Questions!

Journalize all these transactions into a general ledger. Transactions May 1 Purchased merchandise from Keys Wholesale on account for $735.30, Invoice No 91 Dated May 1, terms 2/10, n30 May 2...

In week 1, the "low price" manager cuts prices by 20%. In week 2, the "high price" manager raises prices by 30%, and so forth. Suppose an item started out at $100. A store has two managers, one who...

Poly Products sells packaging tape to industrial customers. All tape is sold in 100-foot rolls that are cut in various widths from a master roll, which is 15 inches wide. The product line consists of...

The Rocky Mountain district sales manager of Rath Publishing Inc., a college textbook publishing company, claims that the sales representatives make an average of 40 sales calls per week on...

Figure 1. Customer Survey Data Based on the recent survey of all of its 200 customers, Techsoft Sales team has prepared the following report: Currently Techsoft has an exceptionally high customer...

Term Project Integrating Techsoft's New Vision Graphics Card into the Supply Chain Company Background Techsoft, a leading technology company specializing in graphics processing, has just developed a...

Company Background Techsoft, a leading technology company specializing in graphics processing, has just developed a new version of their Vision graphics card. The card is 10% smaller than its...

When comparing various divisions within a company, describe what problems can arise from evaluating divisions that have different accounting methods, as described in Chapter 11 of your text. Cite...

\f 134 THE BIG SQUEEZE munications Workers of America that has sought to unionize high"tech workers. "They hire whomever Microsoft tells them to put on their payroll. Then they p~ocess their...

THIS QUESTION IS DUE IN EXACTLY 1 HOUR AND 45 MINUTES. I WILL PAY EXTRA 10 DOLLARS IN TIP IF SOMEONE TYPES THE EXACT ANSWER REQUESTED. PLEASE RESPOND TO THE EACH AND EVERY QUESTION IN A TOTAL OF 3-4...

In Exercise, state the linear inequality whose graph is given in the figure. Write the boundary-line equation in the form Ax + By = C, where A, B, and C are integers, before stating the inequality. 0...

coffee consumed per capita P the relative price of coffee per pound (1967$) I per capita PDI (000s 1967$) P the relative price of tea per quarter (1967$) T trend T1 for 1961Q1 T66 for 1977Q2 D1 for...

An HR manager asks about a manual - dexterity test that has been used to select automobile awembly line workerx "Does this test predict on the job performunce for these types of workers?" On which...

Ortega Companys break-even sales are $600,000. Assuming fixed costs are $180,000, what sales volume is needed to achieve a target net income of $60,000?

The 75 kg climber in Figure is supported in the chimney by the friction forces exerted on his shoes and back. The static coefficients of friction between his shoes and the wall, and between his back...

Two steel pipes AB and BC, each having a weight per unit length of 5 lb/ft, are welded together at B and are supported by three wires. Knowing that a = 1. 25 ft, determine the tension in each wire.

The cartoon shown in Figure lies on a plane tilted at and angle θ = 22.0o to the horizontal, with μk = 0.12. (a) Determine the acceleration of the carton as it slides down the plane. (b) If...

Two crates, of mass 75kg and 110kg, are in contact and at rest on a horizontal surface (Fig. 4-54). A 620-N force is exerted on the 75-kg crate. If the coefficient of kinetic friction is 0.15,...

Six different machines are being considered for use in manufacturing rubber seals. The machines are being compared with respect to tensile strength of the product. A random sample of four seals from...

Suppose f is differentiable on R and a is a real number. Let F(x) = f(xa) and G(x) = [f(x)]a, Find expressions for. (a) F(x) and (b) G (x)

Suppose L is a function such that L (x) = 1/x for x > 0. Find an expression for the derivative of each function. (a) f(x) = L(x4) (b) g(x) = L(4x) (c) F(x) = [L(x)]4 (d) G(x) = L(1/x)

Let r(x) = F(g(h(x))), where h(1) = 2, g(2) = 3, h(1) = 4, g(2) = 5, and f(3) = 6. Find r (1).

Two cards are drawn at random [without replacement) from a regular deck of 52 cards. what is the probability that the rst card is red and the second carcl is the heart

Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.4 million. The fixed asset will be depreciated straight-line to zero over its...

The balance sheet and income statement shown below are for Koski Inc. Note that the firm has no amortization charges, it does not lease any assets, none of its debt must be retired during the next 5...