Suppose a decrease in price increases quantity demanded from 8 to 12.Using the mid-point formula,the percentage change in quantity demanded is:
A) 0.1, and is elastic.
B) 40 = 400 percent.
C) 0.40 = 40 percent.
D) 0.40 = 40 percent

Question

Quizplus · Accepted Answer

The mid-point formula for percentage change in quantity demanded is [(Q2 - Q1) / ((Q2 + Q1) / 2)] * 100. Substituting the values: [(12 - 8) / ((12 + 8) / 2)] * 100 = 40%.

Suppose a Decrease in Price Increases Quantity Demanded from 8