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Toyota would like to forecast the effects of a five-percent price decrease of the Prius in different countries. The Prius is sold in the USA, Japan, and in Europe at different prices. Before the price reduction, three times as many Prius models were sold in Japan as in the USA and Europe respectively. If the elasticity of demand amounts to 2 in the USA, 4 in Japan, and 1 in Europe, then worldwide sales of Toyota cars will change by____________________%.

          Toyota would like to forecast the effects of a five-percent price decrease of the Prius in different countries. The Prius is sold in the USA, Japan, and in Europe at different prices. Before the price reduction, three times as many Prius models were sold in Japan as in the USA and Europe respectively. If the elasticity of demand amounts to 2 in the USA, 4 in Japan, and 1 in Europe, then worldwide sales of Toyota cars will change by____________________%.
        
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Principles of Economics
Principles of Economics
Gregory Mankiw 8th Edition
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Toyota would like to forecast the effects of a five-percent price decrease of the Prius in different countries. The Prius is sold in the USA, Japan, and in Europe at different prices. Before the price reduction, three times as many Prius models were sold in Japan as in the USA and Europe respectively. If the elasticity of demand amounts to 2 in the USA, 4 in Japan, and 1 in Europe, then worldwide sales of Toyota cars will change by____________________%.
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Transcript

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00:01 Toyota announced a plan to adjust its u .s.
00:03 Manufacturing operations to meet customer in demands for smaller, more fuel -efficient vehicles.
00:07 In 2008, toyota started building a plant to produce the 2010 prius for the u .s.
00:12 Marketing blue springs, mississippi.
00:14 Earlier models of the prius were produced in asia.
00:17 First, explain how this change by toyota will influence the u .s.
00:21 Gdp and the components of aggregate expenditure, and second, explain how this change by toyota will influence the factor incomes that make up the u .s.
00:30 Gdp.
00:30 Well, starting with the first one.
00:35 The influence on the us gdp and the components of aggregate expenditure, let's consider consumer spending.
00:46 By adjusting its u .s.
00:48 Manufacturing operations to produce smaller, more fuel -efficient vehicles like the prius, toyota may increase consumer spending on automobiles.
00:56 This could have a positive impact on u .s.
00:58 Gdp as consumer spending is one of the largest components of aggregate expenditure.
01:05 Investment in toyota's investment in building a plan in the u .s.
01:09 To produce the prius ' could increase investment spending in the u .s., which is another component of aggregate expenditure.
01:15 This increase in investment spending could have a positive impact on the u .s.
01:19 Gdp, net exports.
01:24 If the price is produced in the u .s...
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