Ask Question, Ask an Expert

+61-413 786 465

info@mywordsolution.com

Ask Microeconomics Expert

Economics


Home >> Microeconomics

The relationship between Price elasticity of demand and Marginal Revenue can be shown to be:

MR = P 1 ?1/|e|

There are two types of customers that come to the Barnegat Fish Company to have their signature crab cakes: An affluent group with a price elasticity of demand for crabcakes of e = ?2; and a less wealthy type with a price elasticity of demand for crab cakes of e = ?5. The restaurant wants to introduce a coupon to encourage more people to visit their restaurant.

Thus every buyer pays the posted price of $P per crab cake but those who tender the coupon get a discount of $X off the posted price. If the Marginal Cost of a crab cake is $2.00, what is the price of the crab cake and what is the value of the coupon?(Set MR=MC).

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M91234539

Have any Question?


Related Questions in Microeconomics

Question 1 why is it better to measure economic growth via

Question: 1) Why is it better to measure economic growth via real GDP per capital than real GDP? 2) Do some internet research and find out the growth rate of real GDP per capita for last year. How does it compare to our ...

Question occupy wall street was a national and later global

Question: Occupy Wall Street was a national (and later global) organized protest against the greed, bank profits, and financial corruption that led to the 2008-2009 recession. The group popularized slogans like "We are t ...

Question explain how you would create a government program

Question: Explain how you would create a government program that would give an incentive for labor to increase hours and keep labor from falling into the poverty trap. The response must be typed, single spaced, must be i ...

Question please do not send any pictures just text which

Question: Please do not send any pictures, just text which can be copied and modified. Write a short essay of about 750 words on the following topic: How does Mancur Olson explain differences in economic performance of n ...

Question baltimore is in the early stages of its north

Question: Baltimore is in the early stages of its "North Avenue Rising" project. Prior to the implementation, a basic cost-benefit analysis was conducted. You can access this report here or on ELMS. In class, we discusse ...

Question in 1980 the inflation rate in the us was 125 at

Question: In 1980, the inflation rate in the US was 12.5%. At that time, the consensus outlook claimed inflation could not decline by more than 1% per year. That turned out to be incorrect, as it fell to 3.8% in 1982 and ...

Question the patient protection and affordable care act

Question: The Patient Protection and Affordable Care Act established a pilot program to expand the use payment bundling for better coordinated care for Medicare beneficiaries. What impact does payment bundling have on he ...

Question if you want to have 500000 in todays dollars in

Question: If you want to have $500,000 in today's dollars in account after 10 years, how much do you need to put into this account today assuming 3% annual inflation and a 4% nominal annual bank rate compounded monthly? ...

Question three firms are considering entering a new market

Question: Three firms are considering entering a new market. The payoff for each firm that enters is 150/n, where n is the number of firms that enter. The cost of entering is 62. Find all the pure-strategy Nash equilibri ...

Question from 1992 to 1997 the unemployment rate in the us

Question: From 1992 to 1997, the unemployment rate in the US declined from 7.5% to 4.9%, while at the same time it rose from 8% to over 12% in continental western Europe. (A) What factors caused the unemployment rates to ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As

Follow Us

© Copyright 2013-14 mywordsolution.com All rights reserved