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The Acme corporation has started to produce a new widget. They have recently hired you...

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Accounting

The Acme corporation has started to produce a new widget. They have recently hired you and assigned you the task of determining what price the new widget should be. You allowed each subsidiary (A, B, C, D, E, and F) to experiment and price the widget on their own. At the end of the quarter, you requested sales and total revenue data from each subsidiary in order to decide on an overall corporation price for the widget going forward. You received the following data:

image

Q1: What did subsidiary A charge for the widget?

Q2: What did subsidiary F charge for the widget?

Q3: What did subsidiary E charge for the widget?

Q4: Calculate demand elasticity using the midpoint formula between A and B

Q5: Calculate demand elasticity using the midpoint formula between C and D

Q6: Calculate demand elasticity using the midpoint formula between E and F

Q7: Is there (A) elastic, (B) inelastic, or (C) unitary elastic demand between points:

Q7a: A and B

Q7b: C and D

Q7c: E and F

Q8: What would the best price be for Acme to sell widgets at to maximize total revenue?

$15 $30 $45 $60 $75 $90

Total Revenue for Widgets

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