WHAT IS PRICE ELASTICITY OF DEMAND? According to McConnell, Brue & Flynn the law of demand states that other things being equal consumers will buy more of a product when its price declines and less when its price increases. The responsiveness of consumers to a price change is measured by a products price elasticity of demand. In economics, the demand for a certain good or service is represented by the demand curve. The demand curve is plotted on a graph with price labeled on the y-axis and quantity labeled on the x-axis.
ANS. The demand for chicken would increase. As the price of beef rises, consumers would want to buy less beef and substitute chicken that becomes relatively cheaper. b. In the short run, what happens to the demand for beef?
The GDP value would then decrease, due to the move from Point A to C, and increase employment which would decrease savings. In addition, there is an inverse relationship to both bond prices and interest rates because as one increase in value, the other decreases, and vice versa. 2. IS-LM Model--Suppose that you have the following equations for the IS-LM model. The following are the equations of the IS-LM model, here including a feature that taxes are not simply given but depend on income through a tax function, T(Y).
These two “types” of beef illustrate not only dissimilar ethical approaches to the way we eat, but also illustrate two very different business models, the functional approach and the value approach, with different goals and outcomes. Comparing the two will shed light into the peculiarities of both and tell us more about a business model can re-shape the way we think about food. These two kinds of business differ in their functional and value method. The functional approach is design to make more profit. This one invest less money on the product generating more earnings.
-Define cross elasticity of demand and using diagrams explain what determines whether cross elasticity is positive or negative? Cross elasticity of demand is the measure of the responsiveness of demand for one good to a change in the price of another good. It tells us if demand increases or decreases with a change in price of another commodity. Cross elasticity demand tells us two things it determines the positive or negative change. Second is the value of the cross elasticity of demand.
The development of ‘boxed beef’, which has reduced both labor and shipping costs, is illustrative of IBP’s innovating. Instead of hanging and transporting sides of meat, the fat and bone are removed and the meat is vacuum-packed and boxed up. Working with boxed beef makes distribution more efficient, cheaper, and reduces the skills required by labor (Azzam 1998; Brueggemann and Brown 2003; Stull and Broadway 1990; Stull and Broadway 2004). Profits have also been increased by increasing the speed of the ‘chain’ (Eisnitz 1997; Stull and Broadway 1990), or the rate at which the animals are stunned, killed, and “processed” (or dismembered). The Health and Safety Director of the United Food and Commercial Workers union has reported that chain speeds increased between 50% and 80% between approximately 1982 to 1992 (Stull and Broadway 1995, 68).
A. number of close substitutes for the product available to consumers. B. amount of time the producer has to adjust inputs in response to a price change. C. urgency of consumer wants for the product. D. number of uses for the product.Answer | | | | | Selected Answer: | 2. b | Correct Answer: | 2. b | | | | | * Question 4 10 out of 10 points | | | 4. The demand for a product is inelastic with respect to price if: .
For instances, company can choose cost model or revaluation model for property, plant, and equipment. The inventory must be measured at the lower of cost or net realizable value. In addition, according to Mautz (1973), it stated that if who rely on the financial report that measured on historical cost to make decision, found that the information is not useful, then the accounting method will change since it have been made. However, during the times of rising prices, the historical cost accounting has limitations. This is because according to Elliot (1986), it stated that historical cost assumes money holds a constant purchasing power.
Autumn Assignment- Demand and Price Elasticity of Demand Part A Price elasticity of demand is a measure of the sensitivity of demand for a product to changes in its price. (Evan Davis et.al. 2003) An elastic demand means that the quantity demanded is responsive to changes in price; inelastic meaning that the quantity demanded is unresponsive to changes in price. PED can be measured by dividing the percentage change in quantity demanded by the percentage change in price. There are a number of factors effecting price elasticity of demand, the overriding determinant being the availability of substitute goods to the consumer, the more that are made available, the higher the elasticity is likely to be as buyers can easily switch from one product to another.
Use the Boston consulting group matrix to analyze fast eater product portfolio ii) Both burger roles and fried potatoes are in decline, this means that they either need be remarketed in order to keep their market share higher and prevent the decline, also called an extension strategy or they can be left to become dogs. Because of the rapidly falling profitability of the fried potatoes they would be regarded as being closer to dog than Burger rolls. Toasted bacon sandwich provides a constant flow of capital to Fast eaters, and shows no signs of declining, It is a cash cow and the capital it generates can be used to try and save dogs, or more likely used to inject capital into stars or problem children. Cheese and tomato pizza and chicken roles seem to have been ill-advised ventures, with little demand for either of them and almost no sign of growth they would be regarded as dogs. 2) Fast Eater should market a new healthy sandwich, with low calories and carbohydrate count.