A. What is the actual price each motor bike in Papua New Guinea Kina? b. Find the total revenue received by the firm in Papua New Guinea Kina. c. The rate of exchange changes to K1 = A$0.25. Does this

Price in AUD = A$2,000 Initial exchange rate = K1 = A$1

Since K1 = A1, the price in Kina is numerically the same as in AUD. $$ \text{Price in Kina} = \text{Price in AUD} \times \frac{\text{Kina}}{\text{AUD}} = \text{A\2,000} \times \frac{\text{K1}}{\text{A$1}} = \text{K2,000} $$ The actual price each motorbike in Papua New Guinea Kina is $\boxed{\text{K2,000}}$.

Price per motorbike = K2,000 (from part a)
Sales = 150 motorbikes

The total revenue received by the firm is $\boxed{\text{K300,000}}$.

Initial rate: K1 = A$1 New rate: K1 = A$0.25

The Kina now buys fewer Australian Dollars (A$0.25 instead of A$1). This means the Kina has become weaker.
This represents a $\boxed{\text{depreciation}}$ of the Papua New Guinea Kina.

Price in AUD = A$2,000 New exchange rate = K1 = A$0.25

To find out how many Kina are in A1, we can rearrange the exchange rate: $$ \text{A\1} = \frac{\text{K1}}{0.25} = \text{K4} $Now, convert the price of the motorbike:$ \text{New Price in Kina} = \text{Price in AUD} \times \frac{\text{Kina}}{\text{AUD}} = \text{A$2,000} \times \frac{\text{K4}}{\text{A$1}} = \text{K8,000} $$ The new price of each motorbike in Papua New Guinea Kina would be $\boxed{\text{K8,000}}$.

The price of the motorbike increased from K2,000 to K8,000.

According to the law of demand, an increase in price generally leads to a decrease in quantity demanded.
The demand for motorbikes in Papua New Guinea will $\boxed{\text{decrease}}$.

New price per motorbike = K8,000 (from part d)
Assumed sales (unchanged demand) = 150 motorbikes

The new revenue for the firm, assuming demand has not changed, would be $\boxed{\text{K1,200,000}}$.

Price elasticity of demand = 0.5

Since the price elasticity of demand (0.5) is less than 1, the demand is inelastic.
The state of elasticity of demand for the motorbike is $\boxed{\text{inelastic}}$.