Question

1. What is the numerical value for the price elasticity of demand if a price change...

1. What is the numerical value for the price elasticity of demand if a price change causes no change in quantity demanded?________ What is the numerical value for elasticity of demand if a price change causes no change in total revenue?________ What is the elasticity of demand for a horizontal demand curve?________ What is the elasticity of demand if a price increase leads to an increase in total revenue? elastic / inelastic. What is the numerical value for the elasticity of demand if a 2% price decrease leads to a 7 % increase in quantity demanded?________

Homework Answers

Answer #1

What is the numerical value for the price elasticity of demand if a price change causes no change in quantity demanded?
0
This means that demand is insensitive to price changes.


What is the numerical value for elasticity of demand if a price change causes no change in total revenue?
1
It means that demand is unitary elastic.

What is the elasticity of demand for a horizontal demand curve?
Infinity

What is the elasticity of demand if a price increase leads to an increase in total revenue?
Inelastic
When the demand is inelastic, an increase in price leads to higher total revenue and vice-versa.

What is the numerical value for the elasticity of demand if a 2% price decrease leads to a 7 % increase in quantity demanded?
Elasticity of demand = 7/2 = 3.5

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