Quantity Price Elasticity
100 $ 5
1. Determine the price elasticity of demand at each quantity demanded using the formula % chg in QD divided by % chg in price.
2. Redo #1 using price changes of $10 rather than $5
3. Plot the price and quantity data given in demand schedule
4. Indicate the price elasticity value at each quantity demanded
5. Explain why the elasticity value gets smaller as you move down the demand curve
6. Plot the total revenue curve directly below the demand curve measuring total revenue on vertical and quantity on horizontal.
7. Using the demand curve, illustrate what would occur if the income elasticity of demand was.05, and income rose by 10 percent.
8. What would occur if the income elasticity of demand was 3 and income rose by 10%?
Determine the price elasticity of demand in this case.