Question

Last week at a Price of 4.5 the Quantity of some product sold was 21.7. This week at a Price of 18.8 the Quantity sold is 14.6. These two price/quantity combinations are points on the demand curve. What is the price elasticity of demand?

Remember the answer should be a negative number and round to the nearest 0.01.

Answer 1

Price	Quantity
4.5	21.7
18.8	14.6

Using the above table based on the available information in the question, we can calculate the price elasticity of demand through the following formula-

Where,

Thus,

And,

Therefore, elasticity of demand is (-) 0.10.