Use the Graphs Below to Answer the Following Questions

question 128

Essay

Use the graphs below to answer the following questions.
a. Determine equilibrium price and quantity for each graph.
b. Given demand and supply, what would total revenue be for each graph?
c. Assume that supply shifts to the left on both graphs by 100, raising price. Given the new equilibrium price and equilibrium quantity, what would total revenue be for each graph?
d. What do your answers to part c tell you about the relationship between elasticity of demand and total revenue?

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Definitions:

Treasury Stock

A corporation’s own stock that has been issued and subsequently reacquired from shareholders by the corporation but not retired.

Investing Activity

Transactions involving the purchase or sale of long-term assets and investments, reflected in the cash flow statement of a company.

Operating Activities

Activities that relate to the primary operations of a company, such as selling goods and services, which generate revenue and expenses.

Fixed Assets

Long-term tangible assets used in the operations of a business, not expected to be converted to cash within a year.