This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: A firm bought a pizza oven for 13,500 and if it shut down now, could sell the oven for 9,500. Which ... (Read 120 times)

faduma

  • Hero Member
  • *****
  • Posts: 528
on: Jul 1, 2018
A firm bought a pizza oven for 13,500 and if it shut down now, could sell the oven for 9,500. Which of the following statements is TRUE?
 
  A) The relevant cost of the oven when considering shutting down is 13,500.
  B) The relevant cost of the oven when considering shutting down is 9,500.
  C) The relevant cost of the oven when considering shutting down is 4,000.
  D) The cost of the oven does not matter when deciding whether or not to shut down.

Question 2

The demand curve is: QD = 500 - 1/2 P.
 
  a. Calculate the (point) price elasticity of demand when price is 100. Is demand elastic or inelastic?
  b. Calculate the (point) price elasticity of demand when price is 700. Is demand elastic or inelastic?
  c. Find the point at which point elasticity is equal to -1.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

ASDFGJLO

  • Sr. Member
  • ****
  • Posts: 335
Reply #1 on: Jul 1, 2018
Answer to Question 1

C

Answer to Question 2

a. Elasticity = -1/2 (100/450 ) = -0.11, and is inelastic.
b. Elasticity = -1/2(700/150 ) = -2.5, and is elastic.
c. Elasticity is -1 at the midpoint of the demand curve, which is at a price of 500 and a quantity of 250.


faduma

  • Member
  • Posts: 528
Reply 2 on: Jul 1, 2018
Excellent

jackie

  • Member
  • Posts: 324
Reply 3 on: Yesterday
Wow, this really help

« previous next »
 

Did you know?

Nearly all drugs pass into human breast milk. How often a drug is taken influences the amount of drug that will pass into the milk. Medications taken 30 to 60 minutes before breastfeeding are likely to be at peak blood levels when the baby is nursing.

Did you know?

Once thought to have neurofibromatosis, Joseph Merrick (also known as "the elephant man") is now, in retrospect, thought by clinical experts to have had Proteus syndrome. This endocrine disease causes continued and abnormal growth of the bones, muscles, skin, and so on and can become completely debilitating with severe deformities occurring anywhere on the body.

Did you know?

Vampire bats have a natural anticoagulant in their saliva that permits continuous bleeding after they painlessly open a wound with their incisors. This capillary blood does not cause any significant blood loss to their victims.

Did you know?

Certain rare plants containing cyanide include apricot pits and a type of potato called cassava. Fortunately, only chronic or massive ingestion of any of these plants can lead to serious poisoning.

Did you know?

The cure for trichomoniasis is easy as long as the patient does not drink alcoholic beverages for 24 hours. Just a single dose of medication is needed to rid the body of the disease. However, without proper precautions, an individual may contract the disease repeatedly. In fact, most people develop trichomoniasis again within three months of their last treatment.

Application of an ostomy bag or pouch:E, Then, the clamp is securely clipped shut. Application of an ostomy bag or pouch:E, Then, the clamp is securely clipped shut.
The Kingsley plantation, on Fort George Island in Jacksonville, Florida. Zephaniah Kingsley, the own The Kingsley plantation, on Fort George Island in Jacksonville, Florida. Zephaniah Kingsley, the own
One-handed kneading. Tissues are lifted with the whole hand in firm contact. One-handed kneading. Tissues are lifted with the whole hand in firm contact.
Pizza and eating disorders can be life threatening Pizza and eating disorders can be life threatening
Sonal bought a coat for $198.88, which included 8% PST and 5% GST. What was the selling price ... Sonal bought a coat for $198.88, which included 8% PST and 5% GST. What was the selling price ...
Lambs with oven chicken rice and salad Lambs with oven chicken rice and salad
Video: Protein digestion - stomach & small intestine

For a complete list of videos, visit our video library