Question
George has been selling 4,000 T-shirts per month for $7.50. When he increased the price to $9.50, he sold only 1,000 T-shirts. Which of the
George has been selling 4,000 T-shirts per month for $7.50. When he increased the price to $9.50, he sold only 1,000 T-shirts.
Which of the following best approximates the price elasticity of demand?
-5.1
-5.61
-3.06
-4.59
Suppose George's marginal cost is $4 per shirt.
Before the price change, George's initial price markup over marginal cost was approximately (which of the following)
0.3733
0.42
0.4667
0.5133
George's desired markup is____. (0.2157 or 0.1765 or 0.2353 or 0.1961)
Since George's initial markup, or actual margin, was greater or lessthan his desired margin, raising the price was profitable or not profitable.
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