# Answer to Question #70057 in Economics of Enterprise for Melvin Muleya

Question #70057

a) Assuming you are a manager of a beverage manufacturing company and you are operating in a non-competitive market were your firms total cost of production is zero. Indicate what you as the manager must do (cut or raise production) to raise revenue when ;

I. Price elasticity of demand is elastic

II. Price elasticity of demand is inelastic

III. Price elasticity of demand is unit elastic

b) Suppose you decide to produce a drink and you discover it has a demand function given by

I. Price elasticity of demand is elastic

II. Price elasticity of demand is inelastic

III. Price elasticity of demand is unit elastic

b) Suppose you decide to produce a drink and you discover it has a demand function given by

Expert's answer

a)

I. Price elasticity of demand is elastic - cut production,

II. Price elasticity of demand is inelastic - raise production,

III. Price elasticity of demand is unit elastic - any change will have no effect.

b) The question is incomplete, so it can't be answered without additional information.

I. Price elasticity of demand is elastic - cut production,

II. Price elasticity of demand is inelastic - raise production,

III. Price elasticity of demand is unit elastic - any change will have no effect.

b) The question is incomplete, so it can't be answered without additional information.

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## Comments

Assignment Expert15.09.17, 15:32Dear Melvin, your question is still incomplete. Please use the panel to submit a new question.

Melvin Muleya15.09.17, 09:52b) Suppose you decide to produce a beverage and you discover it has a demand function given by

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