Elasticity of demand
Not what you're looking for?
I hope you can help me with this:
Question 1
P 0 1 2 3 4 5 6
Qd 600 500 400 300 200 100 0
A. Graph the data above
b. Calculate the elasticity of demand, using the point formula, as price drops from $6 to 5, then from 5 to 4, 4 to 3, 3 to 2, 2 to 1, and, 1 to 0. Show all work.
C. Calculate the price elasticity of demand, using the mid point formula, for the same price changes as listed in part b. Show all work
C Why are the numbers in part b and part c different?
D Calculate total revenue at each and every price for this demand curve.
E Explain what is happening to the total revenue at each price and why. As prices drop what happens to TR? As prices increase what happens to TR? How do the prices, elasticity and TR all seem to fit together?
f. Which prices are elastic? Inelastic? Unitary Elastic? Explain your answer.
Purchase this Solution
Solution Summary
Calculate total revenue at each and every price for this demand curve.
Purchase this Solution
Free BrainMass Quizzes
Pricing Strategies
Discussion about various pricing techniques of profit-seeking firms.
Basics of Economics
Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.
Economics, Basic Concepts, Demand-Supply-Equilibrium
The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.
Economic Issues and Concepts
This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.
Elementary Microeconomics
This quiz reviews the basic concept of supply and demand analysis.