Refer to the information provided in Figure 5.2 below to answer the question(s) that follow. Figure 5.2
-Refer to Figure 5.2. If the price of a hamburger increases from $8 to $10, the price elasticity of demand equals ________. Use the midpoint formula.
A) -0.33
B) -3.0
C) -30.
D) -300

Question

Refer to the information provided in Figure 5.2 below to answer the question(s) that follow.  Figure 5.2
-Refer to Figure 5.2. If the price of a hamburger increases from $8 to $10, the price elasticity of demand equals ________. Use the midpoint formula.
A) -0.33 
B) -3.0 
C) -30. 
D) -300

Quizplus · Accepted Answer

The midpoint formula for price elasticity of demand is [(Q2 - Q1) / ((Q2 + Q1)/2)] / [(P2 - P1) / ((P2 + P1)/2)], where Q1 and Q2 are the initial and final quantities demanded, and P1 and P2 are the initial and final prices. Without specific quantities from Figure 5.2, we can't calculate the exact value, but given the options, -3.0 is a plausible value for price elasticity of demand, indicating a relatively elastic demand. The other options are either too extreme or not correctly reflecting typical elasticity values.

Refer to the Information Provided in Figure 5