Question

Suppose the price of apples increases from $20 to $28, and in response quantity demanded decreases from 100 to 84. Using the mid-point formula, what is the price elasticity of demand? (Note: your answer should be correct to two decimal places; and be sure to express your answer as a positive number.)

Answer #1

Price |
Quantity
Demanded |

$20 | 100 |

$28 | 84 |

Price elasticity of demand = % change in Quantity Demanded / % change in Price

% change in Quantity Demanded = Q2 - Q1 / (Q1+Q2/2) x 100

% change in Quantity Demanded = 84 - 100 / (100+84/2) x 100

% change in Quantity Demanded = -16/ 92 x 100

% change in Quantity Demanded = -17.39%

% change in Price = P2 - P1 / (P1+P2/2) x 100

% change in Price = 28 - 20 / (20+28/2) x 100

% change in Price = 8 / 24 x 100

% change in Price = 33.33%

Price elasticity of demand = % change in Quantity Demanded / % change in Price

Price elasticity of demand = -17.39 / 33.33

Price elasticity of demand = 0.52

When the price of Milo increases from RM2 to RM3, the quantity
demanded decreases from 200 to 150 glasses per month. The demand
for Nescafe increases from 50 to 100 glasses per month. (a)
Calculate the price elasticity of demand using the midpoint
formula. [10 marks] (b) If the price of Milo decreases, what will
happen to the total revenue of Milo? Explain. [8 marks] (c)
Calculate the cross elasticity of demand between Milo and Nescafe.
Based on the answer,...

When the price of a cruise rises from $19,500 to $20,500, the
quantity demanded decreases from 2,100 to 1,900 travelers.
Use this information to calculate the price elasticity of
demand.
The percentage change in the price of a cruise is——？
The percentage change in the quantity of cruises demanded is
——？percent.
>>> Report your answer as a positive number.
The price elasticity of demand for cruises is——?

If the quantity demanded decreases by %15 and the price goes
from 1.25 to 1.75 what is the elasticity of demand? Is it elastic
or inelastic?
If the price goes down by 20% and the quantity sold increases
from 80 to 120 units what is the elasticity of demand? Is it
elastic or inelastic?

The price of suntan lotion increases from $6 to $8 per bottle
and quantity demanded decreases from 900,000 bottles to 845,000
bottles. Use the midpoint method to calculate the price elasticity
of demand for suntan lotion.
Is demand elasticity or inelastic? How do you know?
What factors might be responsible for you answer in (b)
above?

Consider the market demand curve for apples, which relates the
quantity demanded of apples (in
thousands of bushels) to various prices of apples. Suppose
that the price elasticity of demand for apples is -2.
If the price of apples increases by 3 percent, then by how
much will the quantity demanded of apples
decrease?
Select one:
a. by 2 percent
b. by 6 percent
c. by 6 thousand bushels
d. by 2 thousand bushels

Explain the law of demand, and why as price increases quantity
demanded decreases; and, as price decreases, quantity demanded
increases? If taxes were more progressive, would total output be
affected?

II-0. Suppose that your demand schedule for Movie is as
below.
Price
Quantity Demanded when income =$10,000
Quantity Demanded when income =$20,000
$5
50
60
$7
40
55
$9
30
50
$11
20
45
$13
10
40
Now the movie ticket price is $7 each. If the ticket price rises
to $9 each,
Calculate the price elasticity of demand using midpoint method
when your income is $10,000.
Step 1
How much is the change in quantity
demanded?
What is the...

1.If price rises by 20% and quantity demanded of rice falls by
100 pounds, the elasticity of demand is : (1 point)
a. greater than 1
b. equal to -5
c. equal to -20
d. cannot be determined without additional information.
2.If quantity supplied responds only slightly to a change in
price, then: (1 point)
a. Supply is elastic
b. An increase in price will shift the supply curve to a large
extent
c. Supply is inelastic
d. Supply is...

The price of peanut butter increases from $3.50 to $4.00 per
jar, and the quantity of jelly demanded falls from 35 jars to 28
jars. Using the midpoint formula, calculate the cross-price
elasticity of demand. Report your answer to two decimal places.

When the price of good "X" increases 20 percent (+20%), Harry
decreases his quantity demanded of "X" by 25 percent while Meghan
decreases her quantity demanded of "X" by 15 percent. Harry's
demand for good "X" is (relatively inelastic / unitary elastic /
relatively elastic) and Meghan's demand for good "X" is (relatively
inelastic / unitary elastic / relatively elastic).
A. Relatively inelastic; relatively
inelastic.
B. Relatively inelastic; relatively
elastic.
C. Unitary elastic; relatively
elastic.
D. Relatively elastic; relatively
elastic.

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 11 minutes ago

asked 19 minutes ago

asked 22 minutes ago

asked 27 minutes ago

asked 30 minutes ago

asked 33 minutes ago

asked 42 minutes ago

asked 47 minutes ago

asked 47 minutes ago

asked 51 minutes ago

asked 52 minutes ago

asked 58 minutes ago