Problem Solving

A manufacture of video Games sales 2,500 consoles when the price was at $200.00. To sell 5,000 units they set their price in $100.00. What should be its elasticity?

Show your Calculations

John is the Manager of the stores All Friends. He wants to increase his sales. He markets cleaning products with his top product Remove Stains. Last year he sold 100,000 bottles at $2.00. This year he wants to triple his Sales. Which is his elasticity? If the elasticity is Inelastic or elastic what does John have to do in regards to the sales increase he desires?

Show your Calculations.

An increase in the price of gasoline from 290 to 400 has caused the demand to decrease 600 to 500 per month. Will this be a complementary good or a substitute?

Show your Calculations.

True or False Statements

The law of elasticity establishes that if the consumer likes the product, more he will consume it.

Elasticity can be considered a mathematical mean.
Inelastic, Unitary and Elastic are names given to situations where the consumer finds themselves before possible selection scenarios.
The variables’ of land, labor and capital are present at the time of measuring Elasticity.
5. The Elastic price of demand responds to the variation of pricing of quantity.
6 The Elastic price of demand responds to the variation of quantity of pricing.
7. If the amount of the demand of an article stays the same, but the price goes up from $ 100 to $200 we can say that it is an inelastic demand.
8. If the amount of demand for an article does not vary, but the price goes up from $100 to $200, we can say that it is an inelastic demand.
9. If the quantity of the demand for an item varies and the price goes down from $200 to $100 we can say that it is a unitary demand.
10. An example of an elastic demand of price is the selection of a line area versus another.
11. The Elastic formula contains 3 variables to know: Quantity, Price and Demand.
12. The Elastic formula city contains 2 variables to know: Quantity, Price.
13. The Elastic formula contains only one (1) variable: PQ < 1.
14. Unitary = 1, Elastic >1, Inelastic < 1.
15. Unitary< 1, Elastic > 1, Inelastic < 1.
16. Unitary = 1, Elastic >1, Inelastic < = 1.
17. Elastic goods tend to be cheaper.
18. Elastic goods tend to be expensive and luxurious.
19. Inelastic goods tend to be cheaper.
20. Inelastic goods tend to be cheaper, and are considered basic urgent needs.
21. If the good to be selected are important in the consumer’s budget it’s a unitary demand.
22. Cell phones have revolutionized themselves to being goods of primary need. So we can classify them as Inelastic.
23. An Inelastic Good can’t be a substitute like gas for vehicles, so the demand is Inelastic.

Answer the Following Questions

24. The formula of elasticity is:_____________________________.

25. Choose if the Elastic is elasticity, Inelastic or Unitary.

*Wal-Mart sells dog collars package of 6 at $8.00. They want to reduce their inventory of dog collars so for that reason they offer a special sale of 3 collars at $4.00. Their Elasticity is: _________________________________.

Problem Solving

A manufacture of video Games sales 2,500 consoles when the price was at $200.00. To sell 5,000 units they set their price in $100.00. What should be its elasticity?

Show your Calculations

John is the Manager of the stores All Friends. He wants to increase his sales. He markets cleaning products with his top product Remove Stains. Last year he sold 100,000 bottles at $2.00. This year he wants to triple his Sales. Which is his elasticity? If the elasticity is Inelastic or elastic what does John have to do in regards to the sales increase he desires?

Show your Calculations.

An increase in the price of gasoline from 290 to 400 has caused the demand to decrease 600 to 500 per month. Will this be a complementary good or a substitute?

Show your Calculations.

True or False Statements

The law of elasticity establishes that if the consumer likes the product, more he will consume it.

Elasticity can be considered a mathematical mean.
Inelastic, Unitary and Elastic are names given to situations where the consumer finds themselves before possible selection scenarios.
The variables’ of land, labor and capital are present at the time of measuring Elasticity.
5. The Elastic price of demand responds to the variation of pricing of quantity.
6 The Elastic price of demand responds to the variation of quantity of pricing.
7. If the amount of the demand of an article stays the same, but the price goes up from $ 100 to $200 we can say that it is an inelastic demand.
8. If the amount of demand for an article does not vary, but the price goes up from $100 to $200, we can say that it is an inelastic demand.
9. If the quantity of the demand for an item varies and the price goes down from $200 to $100 we can say that it is a unitary demand.
10. An example of an elastic demand of price is the selection of a line area versus another.
11. The Elastic formula contains 3 variables to know: Quantity, Price and Demand.
12. The Elastic formula city contains 2 variables to know: Quantity, Price.
13. The Elastic formula contains only one (1) variable: PQ < 1.
14. Unitary = 1, Elastic >1, Inelastic < 1.
15. Unitary< 1, Elastic > 1, Inelastic < 1.
16. Unitary = 1, Elastic >1, Inelastic < = 1.
17. Elastic goods tend to be cheaper.
18. Elastic goods tend to be expensive and luxurious.
19. Inelastic goods tend to be cheaper.
20. Inelastic goods tend to be cheaper, and are considered basic urgent needs.
21. If the good to be selected are important in the consumer’s budget it’s a unitary demand.
22. Cell phones have revolutionized themselves to being goods of primary need. So we can classify them as Inelastic.
23. An Inelastic Good can’t be a substitute like gas for vehicles, so the demand is Inelastic.

Answer the Following Questions

24. The formula of elasticity is:_____________________________.

25. Choose if the Elastic is elasticity, Inelastic or Unitary.

*Wal-Mart sells dog collars package of 6 at $8.00. They want to reduce their inventory of dog collars so for that reason they offer a special sale of 3 collars at $4.00. Their Elasticity is: _________________________________.