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Social Science Clinic => Economics => Microeconomics => Topic started by: FButt on May 24, 2019

Title: The table above gives the demand schedule for museum visits. a. You, as the resident economist, have ...
Post by: FButt on May 24, 2019

The table above gives the demand schedule for museum visits.
a.   You, as the resident economist, have been given the task of maximizing the museum's total revenue. What admission price should you charge?
b.   What is the elasticity of demand between $6 and $4?
c.   Moving along the demand schedule from $10 to $8 to $6 and ultimately to $4, how does the price elasticity of demand change in size?

Title: The table above gives the demand schedule for museum visits. a. You, as the resident economist, have ...
Post by: steff9894 on May 24, 2019

a.   The admission price you should charge is $6. The total number of visits will be 300,000 and total revenue is $6 × 300,000 = $1,800,000. No other price gives you this much total revenue.
b.   The price elasticity of demand equals [(300 visits - 400 visits) ÷ 350 visits] ÷ [($6 - $4) ÷ $5] = (0.29) ÷ (0.4) = 0.71.
c.   Moving along the demand schedule to lower prices, the elasticity of demand falls in size.

Title: Re: The table above gives the demand schedule for museum visits. a. You, as the resident economist,
Post by: jie yee lim on Apr 14, 2021

THANK YOU

Title: Re: The table above gives the demand schedule for museum visits. a. You, as the resident economist,
Post by: WONG CHI WEI Moe on Apr 21, 2022

THANK YOU