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ePack: Principles of Microeconomics 6th Edition by Gregory Mankiw
Edition 6ISBN: 978-1133150558ePack: Principles of Microeconomics 6th Edition by Gregory Mankiw
Edition 6ISBN: 978-1133150558 Exercise 3
Suppose the price elasticity of demand for heating oil is 0.2 in the short run and 0.7 in the long run.
a. if the price of heating oil rises from $1.80 to $2.20 per gallon, what happens to the quantity of heating oil demanded in the short run? In the long run? (Use the midpoint method in your calculations.)
b. Why might this elasticity depend on the time horizon?
a. if the price of heating oil rises from $1.80 to $2.20 per gallon, what happens to the quantity of heating oil demanded in the short run? In the long run? (Use the midpoint method in your calculations.)
b. Why might this elasticity depend on the time horizon?
Explanation
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The price elasticity of demand measures ...
ePack: Principles of Microeconomics 6th Edition by Gregory Mankiw
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