00:01
Hello, it's given that the total revenue from the product x, which is equal to the price of x times quantity of x is equal to 50 ,000.
00:24
Also it's given that the total revenue from the good y, which is the price of y, which is the price of y times quantity of y is 90 ,000 and total revenue is the sum of these two 50 ,000 plus 90 ,000 is equal to 140 ,000.
01:01
And now, given these coefficients of elasticity, we need to find how much will this firm terms total revenues change if we increase the price of good x by 2%.
01:20
So we increase the price of good x.
01:31
So now we have this amount of total revenue price and also we know that the price elasticity of demand for good x is negative 3.
01:47
If we increase the price of good x by 2 the quantity demanded will decrease by 6%.
01:56
2 times 3 will be 6%.
02:03
And 6 % is equal to 0 .94 multiplied by quantity of x.
02:20
So we decrease the quantity.
02:25
And since we know that times 0 .94, we know that price of x times quantity of x is equal to 50 ,000.
02:44
From here we can find that new revenue, this is the new revenue of good x, it will be equal.
02:58
To 47 ,940.
03:12
Now we can calculate the total revenue of good product y...