Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter5: Elasticity
Section: Chapter Questions
Problem 31CTQ: Economists define normal goods as having a positive income elasticity. We can divide normal goods...
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Question
Answer number 2 with full solution
![Compute the
following word problems and
identify what type of elasticity is
PED of the
each.
Show your
answers
using both
formula and midpoint formula.
point elasticity
1. Last month, at P14 per
kilowatt
hour
(KWH),
а
household used to consume
380 KWH. However, price of
electricity has risen to P20 per
KWH
that
resulted
to
decreased consumption of 340
KWH.
2. A fruit vendor used to sell
400 oranges at P12 each. Due
to inadequate supply, the price
increased to P16 that led to
selling 200 oranges.
3. Using the point elastic
formula, find the value of Q1 if
Q2=10, P1=30, P2=40, and
PED=1.5](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fcdccb53b-4716-4bb6-a29d-47174f9b008e%2F7dad762d-6a81-4f40-b707-616ff7a8e396%2F2lppz8_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Compute the
following word problems and
identify what type of elasticity is
PED of the
each.
Show your
answers
using both
formula and midpoint formula.
point elasticity
1. Last month, at P14 per
kilowatt
hour
(KWH),
а
household used to consume
380 KWH. However, price of
electricity has risen to P20 per
KWH
that
resulted
to
decreased consumption of 340
KWH.
2. A fruit vendor used to sell
400 oranges at P12 each. Due
to inadequate supply, the price
increased to P16 that led to
selling 200 oranges.
3. Using the point elastic
formula, find the value of Q1 if
Q2=10, P1=30, P2=40, and
PED=1.5
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