Along a given demand curve, the price-elasticity of demand will change. In particular, demand for the good you are selling may be elastic at high prices and low quantities, but inelastic at low prices and high quantities.

A)Why is it the case that in the inelastic portion of demand, you can unambiguously conclude that profit increases as you cut production?

(b) Why is it the case that in the elastic portion of demand, you can't unambiguously conclude that profit increases as you increase production

2.A pet food store receives discounts from a supplier of 6% and 12% on a doggie treat which has a list price of $154.35. The store then marks the treat up 12% of cost for overhead and 40% of selling price for operating profit. Later, the store has a weekend special where they sell the treat at "11% above cost". What was their rate of markdown on the treat? Give your answer as a percent rounded to 2 decimal places.

3.A new lawnmower cost $350, less 30%, 20%, and 10%, and sells to allow for overhead expenses of 30% of the selling price and a profit of 20% of the selling price. During a sale, the lawnmower is marked down by 40%. What is the single equivalent trade discount?

4.London Drugs is selling the new macbook pro for a selling price of $1788.13 with markdowns of 36% and 11%. Future shop is selling the same macbook pro for a selling price of $1785.71 with a markdown of 22%. What additional discount should you ask for from the more expensive shop?

5.A firms profit from selling a particular item is given by the profit function p(x)=41.67x-106. If this same firm has a total cost function given by TC(x)=18.71x+106, then what is the selling price of the item in question?

6.A company has a profit function given by:

Profit = (22.85 - c)x - 11585,

where x represents the number of units being sold and c is the cost of producing the good. The company breaks even after selling 10,000 units. What are the per-unit costs?

7.Happy Planet drinks price change as the quantity sold changes. In particular p=19-0.005x. The total cost to produce the drinks are $5 per drink. Their production factory costs $1903 per month. What is the profit maximum?

8.If a firms total revenue and total cost functions are given respectively by TR(x)=39x and TC(x)=25x+164, then find the profit generated by selling 276 units. Give your answer correct to 2 decimal places.

9.Company supply = 800 hand knit sweaters(Q)

Selling price = $150

Costs:

Mortgage = $1200 per month (4 weeks)

Utilities = $500 per month average

Taxes & Permits = $200 monthly payment

Materials = $20 per sweater (yarn, needed, thread, buttons)

Wages = $10 per hour regular shift; $15 per hour overtime (only use for #9)

Employee Benefit = $50 per worker per month (insurance, etc.)

Production Data:

- 50 full time employees

- all 50 employees work 40 hours every week (4 weeks)

- one sweater can be competed with 10 hours of labor

What is the expectedtotal revenueassuming all 800 sweaters sell?

10.If the equilibrium price decreases and the equilibrium output decreases then what must have happened.