- Calculate TR for each price level
- Graph the demand curve (plotting price and quantity)- do not use a computer generated graph, actually plot on graph paper and make the graph as large as you can on the sheet- you will be submitting this graph for credit
- Draw a different graph (Total Revenue graph draw it under the demand curve) relating to the information on the demand curve you plotted. Align the quantities on both graph (if 1 square = I unit on the demand curve, it will also be = to 1 unit on the TR curve, thus you will be using the same quantity axis measurement on both the demand and TR curves). Plot the TR at the different quantities. You will need two separate graphs given that for the demand curve you will have smaller number on the vertical axis for the demand curve and much larger for the TR curve.
- you have similar graphs on figure 6.3
- Submit the picture of those graphs
- Without calculating the demand elasticity coefficients, show in what price range your demand is elastic, unit elastic and inelastic
- Explain how you assessed those ranges (without using the formula)
- List 4 ways that you could assess the elasticity/inelasticity of the demand curve (also called determinants of price elasticity).
- Briefly explain reasons for each of the 4
- Your graph should be large, clear, neat and a ruler is to be used. Messy graphs will not be given credit.
- You will submit the graphs for credit\
- Based on the demand and TR curves I presume that the demand curve in the price range of ———– will be (elastic, inelastic or unit elastic)—————– BECAUSE——–
- give reasons why you considered a given price range as elastic demand
- list the 4 elasticity determinants
- explain reason for each
Based on the information below please:
Your answers need to be typed in and not hand written.