The following question are based on the following information regarding the gross monthly receipts of a miniature golf course in a resort community at the shore.

-Demand is clearly price elastic between
A) $4.50 and $5.00.
B) $4.00 and $4.50.
C) $3.50 and $4.00.
D) $3.00 and $3.50.
E) There is not enough information to tell.

Question

The following question are based on the following information regarding the gross monthly receipts of a miniature golf course in a resort community at the shore.
 
-Demand is clearly price elastic between
A) $4.50 and $5.00. 
B) $4.00 and $4.50. 
C) $3.50 and $4.00. 
D) $3.00 and $3.50. 
E) There is not enough information to tell.

Quizplus · Accepted Answer

Demand is price elastic when the percentage change in quantity demanded is greater than the percentage change in price. In this case, the percentage change in quantity demanded between $4.50 and $5.00 is -10%, while the percentage change in price is only 11.1%. This means that demand is price elastic between $4.50 and $5.00.

The Following Question Are Based on the Following Information Regarding