According to the midpoint method, the price elasticity of demand between points A and B is approximately Suppose the price of scooters is currently $125 per scooter, shown as point A on the initial graph. Because the demand between points A and B is a $25-per-scooter decrease in price will lead to in total revenue per week. In general, in order for a price decrease to cause a decrease in total revenue, demand must be
According to the midpoint method, the price elasticity of demand between points A and B is approximately Suppose the price of scooters is currently $125 per scooter, shown as point A on the initial graph. Because the demand between points A and B is a $25-per-scooter decrease in price will lead to in total revenue per week. In general, in order for a price decrease to cause a decrease in total revenue, demand must be
Chapter1: Making Economics Decisions
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Transcribed Image Text:6. Elasticity and total revenue
The following graph illustrates the weekly demand curve for motorized scooters in Scottsdale.
Use the green rectangle (triangle symbols) to compute total revenue at various prices along the demand curv
Note: You will not be graded on any changes made to this graph.
PRICE (Dollars per scooter)
325
300
275
250
225
200
175
150
125
100
75
50
25
0
+
A
*
m
Demand
06 12 18 24 30 36 42 48 54
QUANTITY (Scooters)
60
66 72 78
Total Revenue
?
Transcribed Image Text:On the following graph, use the green point (triangle symbol) to plot the weekly total revenue when the market price is $50, $75, $100, $125, $150,
$175, and $200 per scooter.
TOTAL REVENUE (Dollars)
5220
4860
4500
4140
3780
3420
3060
2700
2340
1980
0 25 50
75 100 125 150 175 200 225 250 275 300 325
PRICE (Dollars per scooter)
Total Revenue
According to the midpoint method, the price elasticity of demand between points A and B is approximately
Suppose the price of scooters is currently $125 per scooter, shown as point A on the initial graph. Because the demand between points A and B is
a $25-per-scooter decrease in price will lead to
in total revenue per week.
In general, in order for a price decrease to cause a decrease in total revenue, demand must be
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