Figure 6-2
-Using Figure 6-2, calculate the price elasticity of demand (dropping all minus signs) between P = 10 and P = 12.
A)2.20
B)0.45
C)0.80
D)1.25

Question

Figure 6-2 
-Using Figure 6-2, calculate the price elasticity of demand (dropping all minus signs) between P = 10 and P = 12.
A)2.20 
B)0.45 
C)0.80 
D)1.25

Quizplus · Accepted Answer

The price elasticity of demand (PED) is calculated using the formula: PED = (% change in quantity demanded) / (% change in price). From P = 10 to P = 12, if we assume a linear demand curve and without the specific details from Figure 6-2, we can't calculate the exact changes in quantity demanded. However, given the correct answer is A) 2.20, it suggests that for a price increase from $10 to $12, the percentage change in quantity demanded relative to the percentage change in price results in an elasticity of 2.20, indicating a relatively elastic demand within this price range. This answer is based on the assumption that the specific details from Figure 6-2 would lead to this calculation.

Figure 6-2 -Using Figure 6-2, Calculate the Price Elasticity of Demand (Dropping