(c) Lara offers 100 autograph bats. If each is priced at p dollars, it is that the demand curve dq . dp for the bast will be p = 250 If price elasticily is E(p) : 4 When |E(p)| < 1, q demand is inelastic and when |E(p)| > 1, demand is elastic. (i) Find the price elasticity of demand for Lara's bats. (ii) Is demand inelastic or elastic?
(c) Lara offers 100 autograph bats. If each is priced at p dollars, it is that the demand curve dq . dp for the bast will be p = 250 If price elasticily is E(p) : 4 When |E(p)| < 1, q demand is inelastic and when |E(p)| > 1, demand is elastic. (i) Find the price elasticity of demand for Lara's bats. (ii) Is demand inelastic or elastic?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Good afternoon
Pleae answer i and ii
Transcribed Image Text:(c) Lara offers 100 autograph bats. If each is priced at p dollars, it is that the demand curve
dq dp
-4. If price elasticily is E(p) :
4
When |E(p)| < 1,
p
for the bast will be p = 250
demand is inelastic and when |E(p)|> 1, demand is elastic.
(i) Find the price elasticity of demand for Lara's bats.
(ii) Is demand inelastic or elastic?
Expert Solution
Step 1
c)i) p= 250-q/4
Writing the demand equation in terms of p,
q/4=250-p
q=1000-4p
finding the first order derivative
dq/dp= -4
The price elasticity of demand is given as
Ed= (dq/q)/(dp/p)
= dq/dp*p/q
where dq/dp is the slope of the demand curve
q= 100
p= 250-q/4
p=250-100/4
=250-25
=225
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