Question
A physical therapy clinic faces a demand equation of Q = 200-1.5 P, where Q is sessions per month and P the price per session.
A physical therapy clinic faces a demand equation of Q = 200-1.5 P, where Q is sessions per month and P the price per session.
A.The clinic currently charges $80. What is its sales volume and revenue at this price?
B.If the clinic raised its price to $90, what would happen to volume and revenue?
C.If the clinic lowered its price to $70, what would happen to
volume and revenue?
D.Given these results, what would you recommend that the PT clinic do with respect to the price of its sessions - keep its current price ($80), raise its price ($90) or lower its price ($70)?Explain the reasons for your recommendation.
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