0
What happens when a firm raises its price in a market in which the price is in the inelastic range of the demand curve?
Princehall33
Want this question answered?
Be notified when an answer is posted
Add your answer:
Earn +20 pts
What does it mean the demand for a product is inelastic?
When the demand for a product is inelastic, the product has no close substitutes and can't be easily replaced. Therefore, when the price of the product raises, people buy roughly the same amount of the product because they need it too much. This is in comparison to an elastic demand, where people will buy less of a product when it becomes more expensive.
What happens when demand of a good Increases?
Given supply, if demand of any good increases it raises the prices of the good.
How elasticity of demand effect managerial decisions?
Elasticity of demand measures how much demand for a product will change if the price of that product is changed. Something highly elastic will be greatly affected by price changes (something like a hotdog for example, if a vendor raises his price then demand will drop because people can go elsewhere-demand is elastic). So management must be aware of how consumers will react to price changes. Normally, lowering the price of a good will bring in more customers if the demand for that good is elastic. If it is inelastic, then a lower price will not increase demand much.
What happens when government raises the minimum wage above market levels?
When the minimum wage is above the market levels, people undergo loss of work as companies tend to hire less. This in turn affects the economy of the country and the unemployment rate shoots up.
What is the difference between monopoly and monopolistic competition in the context of diamond market?
Monopoly means a market situation in which there is only a single seller and large no. of buyers. whereas monopolistic competition is a market situation in which there is large no. of sellers and large number of buyers. In monopolistic competition, close substitutes are there in the sense that products are different in terms of size, color, packaging, brand, price, etc. as in the case of soap, toothpaste, etc. In monopoly, there is no close substitute of the good, if any, it will be a remote substitute. In monopolistic competition, there is aggressive advertising but in monopoly, there is no advertising at all or a very little. In monopolistic competition, demand curve faced by the firm is more elastic because of availability of close substitutes. It means if a firm raises its price, it will lose its large market share as customers in large will shift to close substitutes present in the market. In monopoly, the demand curve faced by the firm is less elastic because of no close substitutes. It means if the firm raises its price, demand will not fall in a large quantity as it is only one in the market.
What does it mean the demand for a product is inelastic?
When the demand for a product is inelastic, the product has no close substitutes and can't be easily replaced. Therefore, when the price of the product raises, people buy roughly the same amount of the product because they need it too much. This is in comparison to an elastic demand, where people will buy less of a product when it becomes more expensive.
What happens when demand of a good Increases?
Given supply, if demand of any good increases it raises the prices of the good.
If a company raises its price for holidays over the equilibrium price the demand will?
if a company raises its price for holidays over the equilibrium price, the demand will
How elasticity of demand effect managerial decisions?
Elasticity of demand measures how much demand for a product will change if the price of that product is changed. Something highly elastic will be greatly affected by price changes (something like a hotdog for example, if a vendor raises his price then demand will drop because people can go elsewhere-demand is elastic). So management must be aware of how consumers will react to price changes. Normally, lowering the price of a good will bring in more customers if the demand for that good is elastic. If it is inelastic, then a lower price will not increase demand much.
What happens if bread raises too long?
nothing
What happens when government raises the minimum wage above market levels?
When the minimum wage is above the market levels, people undergo loss of work as companies tend to hire less. This in turn affects the economy of the country and the unemployment rate shoots up.
What happens to our heart rate when you undergo vigorous exercise?
it raises
What happens to the buoyant force on an object as is lowered into water?
It raises.
What is the difference between monopoly and monopolistic competition in the context of diamond market?
Monopoly means a market situation in which there is only a single seller and large no. of buyers. whereas monopolistic competition is a market situation in which there is large no. of sellers and large number of buyers. In monopolistic competition, close substitutes are there in the sense that products are different in terms of size, color, packaging, brand, price, etc. as in the case of soap, toothpaste, etc. In monopoly, there is no close substitute of the good, if any, it will be a remote substitute. In monopolistic competition, there is aggressive advertising but in monopoly, there is no advertising at all or a very little. In monopolistic competition, demand curve faced by the firm is more elastic because of availability of close substitutes. It means if a firm raises its price, it will lose its large market share as customers in large will shift to close substitutes present in the market. In monopoly, the demand curve faced by the firm is less elastic because of no close substitutes. It means if the firm raises its price, demand will not fall in a large quantity as it is only one in the market.
What happens if a video store raises the price of a rental?
it will lose revenue
Need sentence for poultry?
The poultry industry raises, kills and delivers chickens to market.
If a company raises its price for holidays over the equilibrium price the demand will decrease the supply?
decrease and the supply will increase.
