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The Price Elasticity of Demand for Gasoline Is Estimated to Be

Question 52

Essay

The price elasticity of demand for gasoline is estimated to be -0.2.Two million gallons are sold daily at a price of $3.Use this information to calculate a demand curve for gasoline assuming it is linear.

Correct Answer:

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Elasticity = slope (p/Q),-0.2 = slope (3...

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