You are the manager of a firm that receives revenues of $20,000 per year from product X and $100,000 per year from product Y. The own price elasticity of demand for product X is −2, and the cross-price elasticity of demand between product Y and X is −1.6. Required:
How much will your firm's total revenues (revenues from both products) change if you increase the price of good X by 2 percent?

$3,600

Explanation:

Calculation to determine How much will your firm's total revenues change if you increase the price of good X by 2 percent?

Using this formula

Change in Revenue = [PxQx * (1 + Ex) + PyQy * (Ey)] * % change in P

Let plug in the formula

Change in Revenue= [$20,000*(1-2) +$100,000*(1.6)] * 2%

Change in Revenue= [$20,000*(-1) + $100,000*(-1.6)] * 2%

Change in Revenue= [-$20,000 + (-$160,000)] * 2%

Change in Revenue= $180,000*2%

Change in Revenue=$3,600

Therefore how much will your firm's total revenues (revenues from both products) change if you increase the price of good X by 2 percent will be $3,600

g

explanation:

g

the investment was $14,174.196

explanation:

a lump sum means that the father of the example made one deposit and leave it be.

we need to know the value of a capital that generated at 4.05% per year during 28 years the sum of $48,613.24

now clearing the formula to solve for capital we got:

and we reach the answer investment = $14,174.20