6. Elasticity and total revenue
The following graph shows the daily demand curve for bikes in San Francisco.
Use the green rectangle (triangle symbols) to compute total revenue at various prices along the demand curve.
Note: You will not be graded on any changes made to this graph.
Homework (chapter 5) X MindTap - Cengage Learning X C 9. Application: Demand Elasticity x | (70) The Mid point forumula for F X + X C ng.cengage.com/staticb/ui/evo/index.html?deploymentld=59828122270113427286204416098&eISBN=9780357133606&id=865209941&snapshotld=186.. ABP G UA A . .. CENGAGE |MINDTAP Q Search this course ? Homework (Ch 05) X (? ) A-Z 300 275 250 Total Revenue 225 ? PRICE (Dollars per bike) bongo 25 0 Demand 10 20 30 40 50 60 70 80 90 100 110 120 QUANTITY (Bikes) A+ Type here to search A 3:02 PM 159 9/14/2020Homework (chapter 5) X MindTap - Cengage Learning X C 9. Application: Demand Elasticity x (70) The Mid point forumula for F X + X C ng.cengage.com/staticb/ui/evo/index.html?deploymentld=59828122270113427286204416098&eISBN=9780357133606&id=865209941&snapshotld=186.. ABP G UA A . .. CENGAGE |MINDTAP Q Search this course ? Homework (Ch 05) X On the following graph, use the green point (triangle symbol) to plot the annual total revenue when the market price is $50, $75, $100, $125, $150, $175, and $200 per bike. A-Z 10600 9800 Total Revenue ? TOTAL REVENUE (Dollars) 8200 7400 bongo 6600 5800 5000 4200 3400 A+ 0 2 50 75 100 125 150 175 200 225 250 275 300 PRICE (Dollars per bike) Type here to search 3:02 PM 59 A 9/14/2020Homework (chapter 5) X MindTap - Cengage Learning X C 9. Application: Demand Elasticity x | (70) The Mid point forumula for F X + X C ng.cengage.com/staticb/ui/evo/index.html?deploymentld=59828122270113427286204416098&eISBN=9780357133606&id=8652099418snapshotld=186.. ABP G UA A . .. CENGAGE |MINDTAP Q Search this course ? Homework (Ch 05) X TOTAL REVENUE (Dol 7400 3600 5800 A-Z 5000 4200 3400 0 25 50 75 100 125 150 175 200 225 250 275 300 PRICE (Dollars per bike) ? According to the midpoint method, the price elasticity of demand between points A and B is approximately Suppose the price of bikes is currently $125 per bike, shown as point B on the initial graph. Because the demand between points A and B is bongo , a $25-per-bike increase in price will lead to in total revenue per day. In general, in order for a price decrease to cause a decrease in total revenue, demand must be Grade It Now Save & Continue A+ Continue without saving Type here to search A 3:02 PM 159 9/14/2020 73
