-The data in the table above give two points on the demand curve for pizza.Using the midpoint method,when the price of a pizza falls from $10 to $9,what is the price elasticity of demand?
A) 0.5
B) 0.6
C) 0.9
D) 2.1
E) 8.6

Question

-The data in the table above give two points on the demand curve for pizza.Using the midpoint method,when the price of a pizza falls from $10 to $9,what is the price elasticity of demand?
A) 0.5 
B) 0.6 
C) 0.9 
D) 2.1 
E) 8.6

Quizplus · Accepted Answer

The midpoint method for calculating price elasticity of demand is:(Q2 - Q1) / ((Q2 + Q1) / 2) / (P2 - P1) / ((P2 + P1) / 2)Plugging in the values from the table, we get:(100 - 120) / ((100 + 120) / 2) / (9 - 10) / ((9 + 10) / 2) = -20 / 110 / -1 / 9.5 = 2.1

-The Data in the Table Above Give Two Points on the Demand