Nicole Leva Homework Chapter 6 Homework Score 0 of 1 pt Con

Nicole Leva & Homework: Chapter 6 Homework Score: 0 of 1 pt Concept: Compute Price Elasticity HW Sce as indicated in the figure to the right The superstore is considering lowering the price to $8 What is the price elasticity of demand between these two prices (use the Midpoint Formula? The price elasticity of demand is Enter your response as a real number rounded to tao decimal places.) Quanty(copies per day)

Solution

Solution-

Price elasticity of demand = % change in quantity demanded / % change in Price.

        % change in quantity demanded = (44 - 36 / 36) x 100

                                                            = 22.22%

        % change in Price = (8 - 12 / 12) x 100

                                     = - 33.33%

PED = 22.22 / - 33.33 = - 0.66

The Price elasticity of demand is 0.66