Acar dealer wants to get rid of the stock of last year's model. assume that the dealer knows from past experience that the price elasticity of demand for cars is unitary (= 1). if the price of the cars is currently $20,000 and the dealer wants to increase the quantity demanded from 30 units to 50 units, what must the new price be if the dealer is to sell the 20 additional cars?

$6,600

Explanation: According to the question, The price elasticity of demand for cars is unitary meaning that any percentage increase or decrease in price of a product will give an equal increase or decrease in the demand for the product.

If cars are sold at $20,000 and current sales is 30 units. To increase the quantity sold to 50 units, there must be a price reduction.

what percentage of increase in quantity to be sold do we have? 50 - 30 = 20

20/30 = 66.67 appx 67%

Meaning that a 67% decrease in price of the car will give an equal 67% increase in sales quantity.

The new price of the car will be $20,000 * 67% = $13,400

new price = $20,000 - $13,400 = $6,600

The answer is $6,600

Explanation:

The unitary elasticity of demand means that the quantity and price must change in the same proportion .

Using the formula

Old quantity - New quantity / Old quantity × 100%

Old quantity = 30 units, New quantity = 50units

30 - 50 / 30 × 100%

-20/30 × 100%

= -0.666 × 100 ignore the minus sign)

= 67% approximately

The percentage change in cars is 67%

0.67 × 20,000 = 13,400

Therefore the new price is

20,000 - 13,400

= 6,600

Therefore the new price is $6,600

in 2001, dell computer became the world’s largest personal computer vendor, continuing to

gain market share and post profits in an industry struggling with slumping sales and billions of

dollars in losses. dell sells 90% of its pcs directly to the final customer, largely bypassing the

reseller channel that accounts for most of the world’s pc sales. this direct customer relationship

is the key to dell’s business model, and provides distinct advantages over the indirect sales

model. dell’s direct relationship with the customer allows it to tailor its offerings to customer

needs, offer add-on products and services, and use the internet to offer a variety of customer

services. in addition, dell’s pcs are built to customers’ specifications upon receipt of an order,

giving dell additional advantages over indirect pc vendors who must try to forecast demand and

ship products based on those forecasts. dell’s direct sales and build-to-order model has achieved

superior performance in the pc industry in terms of inventory turnover, reduced overhead, cash

conversion, and return on investment (kraemer, et al., 2000).

explanation:

answera public company has access to more capital;