Criminal Justice Capstone Project
December 30, 2020you are encouraged to participate and contribute your thoughts on what should be the goal of a firm
December 30, 2020Calculate price elasticity and markup
- A firm is able to sell 25,000 units at $ 10 per piece. The company fixed cost is $50,000. Variable cost is $5 per unit.
They raise the price to $15 and demand drops to 15000.
a. Calculate the price elasticity.
b. What is the new markup (profit margin %) on the sales price ($15)?
c. What is the new mark up (profit margin %) on total cost?
d. Please calculate the total profit for this company as well as the profit per each toy sold.
e. Are they better off raising the price?