Microeconomics 19th Edition by Campbell McConnell,Stanley Brue,Sean Flynn

Exercise 2

Graph the accompanying demand data, and then use the midpoint formula for E d to determine price elasticity of demand for each of the four possible $1 price changes. What can you conclude about the relationship between the slope of a curve and its elasticity? Explain in a nontechnical way why demand is elastic in the northwest segment of tire demand curve and inelastic in the southeast segment