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Own Price elasticity

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Own Price elasticity. Given the data to the right, compute the POINT elasticity of demand of a good as its price goes from $1.00 to $1.50. Show formula and work.
Price Quantity
1.00 10
1.50 9

Is the demand for this good in this range elastic or inelastic?

If the wage bill per unit of labor (L) is $30 and the cost of capital (K) is $200 in the short run, fill in the BLANKS in the table below.
L Q TVC MPL APL AVC TFC TC ATC MC
0 0 200
1 4 200
2 10 200

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Own Price elasticity is determined.

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Own Price elasticity. Given the data to the right, compute the POINT elasticity of demand of a good as its price goes from $1.00 to $1.50. Show formula and work.
Price Quantity
1.00 10
1.50 9

Point elasticity = % change in quantity ...

Solution provided by:
Gaurav Agarwal, MS
Education
  • BE, Bangalore University, India
  • MS, University of Wisconsin-Madison
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  • "Thank you, this helped a lot. I was not sure how to plug in those numbers to a formula. This was a great help. Now I have to figure out how to explain cost of capital is used in net present value analysis, and how cost of capital is used in net present value analysis. This stuff gets confusing."
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