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Homework answers / question archive / a) As the production manager, explain to the CEO how price elasticity influence decision on pricing strategy for your company
a) As the production manager, explain to the CEO how price elasticity influence decision on pricing strategy for your company.
b) The Future Flight Corporation manufactures a variety of Frisbees selling for $2.98 each. Sales have averaged 10,000 units per month during the last year. Recently Future Flight's closest competitor, Soaring Free Company, cut its prices on similar Frisbees from $3.49 to $2.59. Future Flight noticed that its sales declined to 8,000 units per month after the price cut.
What is the cross elasticity of demand between Future Flight's and Soaring Free's Frisbees?
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