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If demand is elastic at the current price, the company knows that an increase in price would reduce total revenues.
What else can I help you with?
What are the uses of price elasticity of demand to the business firms and to the government?
Elasticity measures help the sales manager in fixing the price of his product. The concept is also important to the economic planners of the country. In trying to fix the production target for various goods in a plan, a planner must estimate the likely demand for goods at the end of the plan. This erequires the use of income elasticity concepts.The price elasticity of demand as well as cross elasticity would determine the substitution between goods and hence useful in fixing the output mix in a production period. The concept is also useful to the policy makers of the government, in particular in determining taxation policy, minimum wages policy, stabilization programmer for agriculture, and price policies for various other goods (where administered prices are used).The managers are concerned with empirical demand estimates because they provide summary information about the direction and proportion of change in demand, as a result of a given change in its explanatory variables. From the standpoint of control and management of external factors, such empirical estimates and their interpretations are therefore, very relevant.
What is a good topic for an article summary in microeconomics?
A good topic for an article summary in microeconomics could be "The Impact of Price Elasticity on Consumer Behavior." This topic allows for an exploration of how changes in price affect demand for goods and services, highlighting concepts like substitutes and complements. It can also discuss real-world applications, such as pricing strategies for businesses and implications for government policy. Overall, it provides a practical lens through which to understand consumer choices and market dynamics.
How does the government fiscal policy affect the economy?
When inflation increase
What are the factors affecting business policy?
There are many different factors that affect business policy. These different factors range from shareholders to the dividend policy of a certain business.
What is price skimming?
Price skimming is pricing policy by the producer to sell his product with initially for high price and then at decreasing rate over the time.
How does elasticity a company's pricing policy?
If demand is elastic at the current price, the company knows that an increase in price would reduce total revenues.
If you receive a ticket in Georgia for 83 mph in a 70 mph zone will this affect your insurance rates?
It might if your carrier finds out about it. Most insurance companys (after the inital policy has been written), will rule 'clues' or driving records periodically on their insureds. If that happens and your ticket is found, it might affect your rates, and it might not, it will depend on your companys underwriting rules, if you are worried about it call your companys policy services dept and ask them.
What would you expect from a supermarket pricing policy?
From a supermarket pricing policy, one would expect transparency in pricing, consistent pricing across different locations, competitive pricing strategies to attract customers, and adherence to legal regulations regarding pricing and promotions.
Which pricing policy adopted by Nike in south African country?
Which pricing policy adopted by nike in south African country?"
What is the pricing policy on cakes?
about $6.00
WHAT are Uses of PRICE ELASTICITY OF DEMAND?
There are several uses of Price Elasticity of Demand that is why firms gather information about the Price Elasticity of Demand of its products. A firm will know much more about its internal operations and product costs than it will about its external environment. Therefore, gathering data on how consumers respond to changes in price can help reduce risk and uncertainly. More specifically, knowledge of Price Elasticity of Demand can help the firm forecast its sales and set its price.Sales forecasting: The firm can forecast the impact of a change in price on its sales volume, and sales revenue (total revenue, TR). For example, if Price Elasticity of Demand for a product is (-) 2, a 10% reduction in price (say, from $10 to $9) will lead to a 20% increase in sales (say from 1000 to 1200). In this case, revenue will rise from $10,000 to $10,800.Pricing policy: Knowing Price Elasticity of Demand helps the firm decide whether to raise or lower price, or whether to price discriminate. Price discrimination is a policy of charging consumers different prices for the same product. If demand is elastic, revenue is gained by reducing price, but if demand is inelastic, revenue is gained by raising price.Non-pricing policy: When Price Elasticity of Demand is highly elastic, the firm can use advertising and other promotional techniques to reduce elasticity.
What is Heineken pricing strategy?
Globally, Heineken utilizes the premium pricing policy. This is effective as the Heineken brand is unique to that of competitors.
How do you answer what is good?
if a customer complanied about an assocaiate in your store pricing or a policy what would you do
Are there any Toyota dealerships that offer a no-haggle pricing policy?
Yes, some Toyota dealerships offer a no-haggle pricing policy, which means the price listed is the final price without any negotiation.
What companys offer car breakdown cover?
AAA is one of the most popular companys that offer coverage for your car if it breaks down, but many insurance companies also may include coverage in your insurance policy.
What are the benefits of health insurance policy?
See the link on Pricing & Benefits for Calfornia
How do you answer 'What is good customer?
if a customer complanied about an assocaiate in your store pricing or a policy what would you do
