David and Mandy each have a budget of $200.00 per month to spend on computer games...

 

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David and Mandy each have a budget of $200.00 per month to spend on computer games and movie tickets. At the initial prices, David consumes both goods, but Mandy buys only computer games and does not go to watch movies. Now, the price of movie tickets has fallen. Use figures to show that David's utility must increase, and that Mandy's utility may increase or stay the same but cannot fall. The demand curve for a good is Q = 800 - 3p². What is the elasticity at the point p = 4 and Q 384? Is the demand curve elastic or inelastic at this point? Assume that the elasticity of demand for Apple apps is -1.9. This elasticity applies to a small college town where consumers buy approximately 900 apps per month. If prices rise by 10%, what would be the effect on quantity demanded? Would revenue rise or fall? What is the percentage change in revenue (= Price x Quantity)? David and Mandy each have a budget of $200.00 per month to spend on computer games and movie tickets. At the initial prices, David consumes both goods, but Mandy buys only computer games and does not go to watch movies. Now, the price of movie tickets has fallen. Use figures to show that David's utility must increase, and that Mandy's utility may increase or stay the same but cannot fall. The demand curve for a good is Q = 800 - 3p². What is the elasticity at the point p = 4 and Q 384? Is the demand curve elastic or inelastic at this point? Assume that the elasticity of demand for Apple apps is -1.9. This elasticity applies to a small college town where consumers buy approximately 900 apps per month. If prices rise by 10%, what would be the effect on quantity demanded? Would revenue rise or fall? What is the percentage change in revenue (= Price x Quantity)?

Answer rating: 100% (QA)

QUESTION 1 Determine the elasticity at the point where p 4 and Q 384 Calculate the price elasticity of demand using the given demand curve equation De... View the full answer