An experiment is conducted that provides the data in the accompanying table. Toll rate Number of vehicles using the tollway per day $8 10,000 $6 12,000 a. What is the absolute value of price elasticity when the toll rate decreases from $8 to $6? Round to the nearest hundredth. c. What is the change in total revenue when the toll is decreased from $8 to $6?
An experiment is conducted that provides the data in the accompanying table. Toll rate Number of vehicles using the tollway per day $8 10,000 $6 12,000 a. What is the absolute value of price elasticity when the toll rate decreases from $8 to $6? Round to the nearest hundredth. c. What is the change in total revenue when the toll is decreased from $8 to $6?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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An experiment is conducted that provides the data in the accompanying table.
| Toll rate | Number of vehicles using the tollway per day |
|---|---|
| $8 | 10,000 |
| $6 | 12,000 |
a. What is the absolute value of price elasticity when the toll rate decreases from $8 to $6?
Round to the nearest hundredth.
c. What is the change in total revenue when the toll is decreased from $8 to $6?
Transcribed Image Text:An experiment is conducted that provides the data in the accompanying table.
Number of vehicles using the tollway per day
Toll rate
$8
10,000
$6
12,000
a. What is the absolute value of price elasticity when the toll rate decreases from $8 to $6?
Round to the nearest hundredth.
Absolute value of price elasticity of demand: -0.64
Incorrect
b. Price elasticity of demand for the toll road is considered to be
inelastic.
c. What is the change in total revenue when the toll is decreased from $8 to $6?
$ 8000
Incorrect
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