Question

QUESTION 1

The marketing department for a firm that manufactures Mrola handphones has obdurate the following bring function for their p[roducts:

Qm = 2550 0.25 Pm 0.82 Pc + 0.04 Y + 0.02A

Where:
Qm= line number of the firms Mrola handphones sold monthly.
Pm= the price of the firms Mrola handphones
Pc = the price of other related product
Y = average household income
A= periodical advertising dollars spent.

Given Pm = RM cc0, Pc = RM1500, Y = RM5000, and A = RM150000

a) Derive the demand Curve Function for Mrola handphones.

Qm = 2550 0.25(2000) 0.82(1500) + 0.04(5000) + 0.02(15000)
= 2550 500 1230 + 200 + 300
= 1320.

A=2550 0.82(1500) + 0.04(5000) + 0.02(15000)
= 2550 1230 + 200 + 300
=1820.

Qm = A bPm

Qm = 1820 0.25Pm

b) How much is Mrola handphones sold periodic?

RM 1320 for a month

1320 / 4 = RM 330 unit

c) If the firm wants to maximize total revenue, qualify the number of Mrola handphones that should be produced and at what price to sell.

Q = 1820 0.25P

0.25P = 1820 Q
P = 1820 Q
0.



25
P = 7280 4Q

TR = (7280 4Q) X Q
= 7280Q 4Q2

dTR = 7280Q 4Q2
dQ
= 7280 8Q

7280 8Q = 0
7280 = 8Q
Q = 7280 / 8
Q = 910

P = 7280 4(910)
= 7280 3640
= RM 3640

d) Calculate the price elasticity of demand is the demand elastic or inelastic? If the firm decreases the price, what pull up stakes be the effect on total revenue? Explain.

?p = - 0.25 X 2000 / 1320

= - 0.38 (inelastic)

*If the firm decreases the price, the quantity of the demand will increase. consequently the firm will not be able to utmost their total revenue.

e) Determined the income...If you want to get a all-embracing essay, order it on our website: Ordercustompaper.com



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