Due to the impact of Tropical Storm Harry in the Caribbean, the price of sugar rises from $0.50 to $1.00 per bag and the quantity demanded falls from 120 bags to 40 bags. a) Using your knowledge from Finite Math, show that the price-demand function is p(x)=-0.00625x+1.25 b) Calculate the elasticity of demand for sugar. c) Is sugar elastic, unitary or inelastic in this price range? (HINT: Try about 3 prices in the price-range)

Due to the impact of Tropical Storm Harry in the Caribbean, the price of sugar rises from $0.50 to $1.00 per bag and the quantity demanded falls from 120 bags to 40 bags. a) Using your knowledge from Finite Math, show that the price-demand function is p(x)=-0.00625x+1.25 b) Calculate the elasticity of demand for sugar. c) Is sugar elastic, unitary or inelastic in this price range? (HINT: Try about 3 prices in the price-range)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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