Strayer New ECO550 Week 2 Chapter 3 and Chapter 4 ProblemsECO 550 Week 2 Chapter three and Chapter four ProblemsChapter three: Issues three, four, and 73. The Olde Yogurt Manufacturing facility has lowered the value of its common Mmmm Sundae from $2.25 to $1.75. Consequently, the firmâs each day gross sales of those sundaes have elevated from 1,500/day to 1,800/day. Compute the arc worth elasticity of demand over this worth and consumption amount vary.four. The subway fare in your city has simply been elevated from a present stage of 50 cents to $1.00 per experience. Consequently, the transit authority notes a decline in rider-ship of 30 %.a. Compute the value elasticity of demand for subway rides.b. If the transit authority reduces the fare again to 50 cents, what affect would you anticipate on the ridership? Why?7. In an try to extend revenues and earnings, a agency is contemplating a four % enhance in worth and an 11 % enhance in promoting. If the value elasticity of demand is ?1.5 and the promoting elasticity of demand is +zero.6, would you anticipate a rise or lower in complete revenues?Chapter four: Issues 5, 6, and 75. Common Cereals is utilizing a regression mannequin to estimate the demand for Tweetie Sweeties, a whistle-shaped, sugar-coated .com/" fashion="margin: 0px; padding: 0px; border: 0px; define: 0px; vertical-align: baseline; coloration: rgb(155, 136, 31);">breakfast cereal for youngsters. The next (multiplicative exponential) demand operate is getting used:6. The demand for haddock has been estimated as log + b log P + c log I + d log Pmwhere of haddock offered in New England per pound of haddockmeasure of non-public earnings within the New England regionindex of the value of meat and poultrya. Decide the value elasticity of demand. b. Decide the earnings elasticity of demand.c. Decide the cross worth elasticity of demand.d. How would you characterize the demand for haddock? Apparently the Haddock is plentiful because it a white fish. New England has a number of ocean entry to fish. e. Suppose disposable earnings is predicted to extend by 5 % subsequent yr.7. An estimate of the demand operate for family furnishings produced the next outcomes:1.08 .16 -.48Y R P the place expenditures per householdpersonal earnings per householdof personal residential development per householdof the furnishings worth index to the buyer worth indexa. Decide the purpose worth and earnings elasticities for family furnishings.b. What interpretation would you give to the exponent for R? Why do you suppose R was included within the equation as a variable?c. When you had been a provider to the furnishings producer, would you've gotten most well-liked to see the evaluation carried out in bodily gross sales models reasonably than dollars of income? How would this variation alter the interpretation of the value coefficient, presently estimated as ?zero.48?