Results 1 to 3 of 3

Math Help - Help with economics question :)

  1. #1
    Newbie
    Joined
    Sep 2010
    Posts
    7

    Red face Help with economics question :)

    Hi guys,
    I wasnt sure how to draw up this table. I know that
    total revenue= price x quantity
    However Im having troubles with how to start off drawing the table. i.e what figures to use for this question. any help would be appreciated

    Question:
    Assume that children’s advocates have been successful in imposing restrictions on the amount of commercials for junk food that can be aired during children's television shows. In fact, the restrictions have initially reduced the quantity of advertising allowed during children's viewing hours by 33 percent. In the months following the restrictions, the price of a minute of advertising on network television increased by approximately 14 percent.

    What impact do you think this situation has had on the total revenues of the television networks?
    Follow Math Help Forum on Facebook and Google+

  2. #2
    MHF Contributor
    Joined
    May 2010
    Posts
    1,030
    Thanks
    28
    For explanatory purposes here is a very long winded answer:

    Suppose that the starting sales volume is X, and the starting price is P.
    Starting Revenue: XP

    You are told that the new sales volume = (2/3) * X
    You are told that the new sales price = 1.14P
    So the New total revenue is (2/3)*1.14 * XP = 0.76XP


    If the new revenue is 0.76XP, and the starting revenue is XP.....the percentage change in revenue is
    \frac{0.76XP - XP}{XP} = 0.76 -1 = -24\%


    As you get experienced, you may be able to do these with much less working. eg, note that revenue is proprtional to volume and price. So there is a 33.3333% drop followed by a 14% increase. overall Change = (2/3)*(1.14) - 1.
    Follow Math Help Forum on Facebook and Google+

  3. #3
    Newbie
    Joined
    Sep 2010
    Posts
    7
    Hi SpringFan 25,

    Thanks heaps for your prompt reply
    Follow Math Help Forum on Facebook and Google+

Similar Math Help Forum Discussions

  1. Help with an economics question?
    Posted in the Business Math Forum
    Replies: 2
    Last Post: September 6th 2011, 10:15 AM
  2. Economics question
    Posted in the Business Math Forum
    Replies: 2
    Last Post: May 23rd 2010, 04:13 AM
  3. Economics Profit Max Question
    Posted in the Business Math Forum
    Replies: 0
    Last Post: January 28th 2010, 09:53 AM
  4. Economics question
    Posted in the Business Math Forum
    Replies: 4
    Last Post: January 9th 2010, 09:08 AM
  5. Economics Question
    Posted in the Business Math Forum
    Replies: 3
    Last Post: October 9th 2008, 07:52 PM

Search Tags


/mathhelpforum @mathhelpforum