managerial economics
posted by rich .
Question #6
The owner of Taco Joe’s has estimated that if he lowers the price of a burrito from $2.00 to $1.50, he will increase sales from 400 to 500 burritos per day. The demand for burritos is
A) elastic.
B) inelastic.
C) unitary elastic.
D) perfectly elastic.
Question #7
The demand curve for your product is P = 1000  2×Q and you have constant marginal cost equal to 400. According to the midpoint pricing rule, your profit maximizing price should be
A) $1000.
B) $400.
C) $300.
D) $700.
E) $450.
Question #8
Suppose that elasticity of demand for your product is 3 and your marginal cost is 12. Then – according to the rule for markup pricing on cost – you should charge a price of
A) 36.
B) 4.
C) 18.
D) 24.
E) None of the above – more information is needed.
Question #9
A lossmaking firm stands to gain rather than shutting down so long as
A) average variable cost is greater than marginal cost.
B) price is sufficient to cover average fixed cost.
C) average fixed cost is greater than average variable cost.
D) price is sufficient to cover average variable cost.
Question #10
Spreading the fixed costs of distribution over multiple products is known as __________, whereas the decrease in average variable cost due to the effect of cumulative production over time is known as _________.
A) economies of scope; learning effects.
B) economies of scale; learning effects.
C) economies of scope; economies of scale.
D) learning effects; economies of scale.

managerial economics 
economyst
repost plz.

managerial economics 
Brian S.
6) Unitary elastic.
% change in price = ($2.001.50)/2.00 = 25%
% change in qty demand = (500400)/400 = 25%
elasticity = % qty / % price = 1
When elasticity is exactly 1, this is referred to as unit elasticity. 
managerial economics 
Brian S.
7)
P = 1000  2Q
One good visual method to figure out the quantities which will let us find the optimal quantity using the midpoint is to test each proposed quantity,
Given Formula = Qty Sold Revenue(PxQ) Profit
$1000: 1000 = 1000  2Q. Q = 0 R = 0 Pr = 0  0 = $0
$700: 700 = 1000  2Q. Q = 150 R = 105000 Pr = 105000  150(400) = $40500
$450: 450 = 1000  2Q. Q = 275 R = 123750 Pr = 123750  275(400) = $13750
$400: 400 = 1000  2Q. Q = 300 R = 120000 Pr = 120000  300(400) = $0
$300: 300 = 1000  2Q. Q = 350 R = 105000 Pr = 105000  350(400) = $35000
Midpoint = (1000 + 400)/2 = $700 (ignore hypothetical $300 pricepoint because it results in a loss). We want the midpoint between the two zero profit points, which come from a price of $1000 and a price of $400.
We can confirm this method yields the highest profit in the table to the far right, where total profit for the $700 pricepoint is $40500, by far the highest of the multiple choice answers.
Respond to this Question
Similar Questions

Managerial Economics
I need assistance with the following question: A researcher estimated that the price elasticity of demand for automobiles in the United States is 1.2, while the income elasticity of demand is 3.0. Next year, U.S. auto makers intend … 
Managerial Economics
Auto Maintenance Services (AMS) is a small auto service outlet in a suburban area of Syracuse. In reaction to a small increase in wages that has caused the marginal cost of this auto service establishment to increase from $25 to $30, … 
Managerial EconomicsREALLY NEED HELP BY TOMORROW
Auto Maintenance Services (AMS) is a small auto service outlet in a suburban area of Syracuse. In reaction to a small increase in wages that has caused the marginal cost of this auto service establishment to increase from $25 to $30, … 
Managerial Economics
Please help with this question: A researched estimated that the price elasticity of demand for automobiles in the U.S. is 1.2, while the income elasticity if demand is 3.0. Next year, U.S. auto makes intend to increase the avg price … 
math
The cost of one burrito,b,and one taco,a, is less than the cost of two burritos. Which inequality represnts this relationship 
managerial economics
Exercise 1 The marketing manager has estimated the company’s demand curve with the equation P=3000 – 40Q. To develop a deeper understanding of pricing and quantity to be produced, complete the following analyses: 1. Draw the demand … 
algebra
how to find out the individual price of a 5 tacos and 8 burritos if the total is $13. 76 and the price 6 tacos and 7 burritos if the total is $14. 26? 
math
You order sixteen burritos to go from a Mexican restaurant: seven with hot peppers and nine without. However, the restaurant forgot to label them. If you pick four burritos at random, find the probability that at least two of the burritos … 
Math
You order twelve burritos to go from a Mexican restaurant, five with hot peppers and seven without. However, the restaurant forgot to label them. You pick three burritos at random. Find the probability of the events (as a reduced fraction … 
Algebra
You and a friend eat tacos. You order 2 tacos and 5 burritos which equals $19. Your friend orders 1 taco and 4 burritos which equals $14. Find the cost of a taco and a burrito. Please help