Refer to the above data.What is the price elasticity of demand over the range of $8 to $10?
A) 0.11
B) 0.47
C) 1.93
D) 1.43 Over this range the change in quantity is (40 - 36)/(40 + 36)= 0.053,and the change in price is (10 - 8)/(10 + 8)= 0.111.Thus,elasticity is 0.47.

Question

Refer to the above data.What is the price elasticity of demand over the range of $8 to $10?
A) 0.11 
B) 0.47 
C) 1.93 
D) 1.43 Over this range the change in quantity is (40 - 36)/(40 + 36)= 0.053,and the change in price is (10 - 8)/(10 + 8)= 0.111.Thus,elasticity is 0.47.

Quizplus · Accepted Answer

The price elasticity of demand over the range of $8 to $10 is 0.47, which is less than 1 indicating an inelastic demand. Therefore, increasing the price from $8 to $10 will only result in a small decrease in quantity demanded.

Refer to the Above Data