Variables given:
Output = 20,000
Price = $10
Fixed costs = $60,000
AVC = $6 (a 10 % decrease output decreases AVC to $5.40)
Arc price elasticity of Demand is -2.0
Solution given:
%?P = -.05 = (P2 - 10)/((P2 + 10)/2)
P2 = 9.51
%?Q = .10 = (Q2 - 20,000)/((Q2 + 20,000)/2)
Q2 = 22,100
Question:
Can you walk me thro...
DATE
Question answered on Jul 22, 2018
PRICE: $14.99
Solution~000542522.zip (18.37 KB)