If the price elasticity of demand for a product is 0.5, then a price cut from $3.00 to $270 wil Multiple Cholce Increase the quantity demanded by about 50 percent decrease the quantity demanded by about 5 percent. Increase the quantity demanded by about 5 percent.

If the price elasticity of demand for a product is 0.5, then a price cut from $3.00 to $270 wil Multiple Cholce Increase the quantity demanded by about 50 percent decrease the quantity demanded by about 5 percent. Increase the quantity demanded by about 5 percent.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter3: Demand Analysis

Section: Chapter Questions

Problem 2E: The price elasticity of demand for personal computers is estimated to be 2.2. If the price of...

See similar textbooks

Related questions

Q: If the price elasticity of demand for a product is equal to 0.4, then a decrease in price of 8…

Q: The quantity demanded of a product rises from 90 to 110 units when the price falls from $1.20 to…

A: ∆Q= 20 ∆P=$0.40 Q=90 P=$1.20

Q: If the price elasticity of demand is 0.6, then a 10 percent increase in the price of the good will…

A: The price elasticity of (Ed) demand measures the extent of sensitiveness of quantity (Qd) demanded…

Q: If price elasticity of supply is +0.66 Find the value of change in quantity supplied if change in…

A: The information being given is as follows:- Price elasticity of supply = 0.66 Change in price = 33%…

Q: A consumer buys 160 units of a goods at a price of 8 per unit. Price falls to 6 per unit. how much…

A: The initial price of goods = 8 Final price of goods = 6 Initial quantity = 160 units Elasticity of…

Q: Calculate price elasticity of demand when percentage change in price is 2% and percentage change in…

A: Elasticity of demand is used to find the relationship between quantity demanded and the determinants…

Q: The price elasticity of demand for a popular sporting event is 1.2. If the price of a ticket to this…

A: Elasticity is an economic metric that measures how sensitive one economic component is to another,…

Q: Calculate Price Elasticity of Demand for pens when the price rises from $4 to $6 a pen and quantity…

A: Price Elasticity of Demand is showing the sensitivity of changing quantity demanded to the changing…

Q: Zulaikha wanyed to buy 10 kg of rice and Ker Xin wanted to buy RM 20 worth of rice. Find the price…

A: Price elasticity of demand is defined as the responsiveness of the quantity demanded of a commodity…

Q: When price of a commodity falls by 50% and the quantity demanded increases by 100% find the price…

A: Elasticity of demand measures the responsiveness of change in quantity demanded to change in price.…

Q: Price elasticity of demand is defined as: a. the percentage change in price divided by the…

A: The elasticity of demand is the responsiveness from the part of the consumer towards the changes in…

Q: When the price of Product E decreases 2%, this causes its quantity demanded to increase by 14% and…

A: Note: “Since you have asked multiple questions, we will solve the first question for you. If you…

Q: A price elasticity of demand equal to 5 means

A: The formula for elasticity is given by: ep = [dq/dp] x [p/q] If ep > 1 then elastic demand If…

Q: The cross-price elasticity of demand between movie tickets and movie theater popcorn is estimated to…

A: Cross price elasticity measures how quantity demanded of one good changes when price of other good…

Q: At price of 20 per unit, the quantity demanded of a commodity is 300 units. If price falls by 10%,…

A: Given data: Initial price P=20 Initial quantity Q=300 Price falls by 10% Quantity demanded rises by…

Q: If the price elasticity of demand is 0.15, and the price is doubled, this will lead to a a. 30…

Q: Find percentage change in demand if elasticity of demand is 0.88 and the % change in Price is 20%

A: The data presented In the question above is:- Percentage change in price = 20% Elasticity of demand…

Q: The price elasticity of demand for product X is reported to be 3.0. This means that a a. 3 percent…

A: Price elasticity of demand measures the responsiveness of demand to a change in the price level.…

Q: The price elasticity of demand for peanuts is 2.5 by what percentage will quantity demanded rise…

A: Price elasticity of demand is the index that is calculated by dividing the percentage change in…

Q: If the price elasticity of demand is -2.5, O a 1% decrease in price leads to a 2.5% increase in…

A: The formula for price elasticity of demand: Price elasticity of demand (ep): Given- ep = -2.5

Q: Calculate the value of elasticity of demand when the percentage rise In demand is 0 and the % fall…

A: # When price falls, demand rises when the good is a normal good. To what degree the demand changes,…

Q: A change in price of $10 from initial price of $15 leads to a change in quantity demanded of 100…

A: The economics as a study is based upon the idea that the resources which the economies have tend to…

Q: If the price elasticity of demand for a product is 5, and prices decrease 10 percent then demand…

A: Price elasticity of demand measures the responsiveness of quantity demanded for a good due to…

Q: If the elasticity of demand for milk tea equals -1.5 and the quantity demanded equals 40,000,…

A: Given information: Price elasticity: -1.5 Initial Quantity demanded: 40,000 Formula of price…

Q: When the price of Caribou Coffee increased by 12 percent, the quantity demanded of Gloria Jean's…

A: Price elasticity of demand(e) is the change in the quantity demanded(Q) of a good for a one percent…

Q: The demand for a good doubles due to a 25 percent fall in its price calculate the price elasticity…

A: Price elasticity of demand is a measure of the degree of responsiveness of changes in demand caused…

Q: If the price elasticity of demand for good X is 0.8

A: Elasticity of demand is a technique with the help of which change in quantity demanded is measured…

Q: If the price elasticity of demand for a product is 0.5, then a price cut from $3.00 to $2.70 will 15…

A: Price elasticity of demand: - Price elasticity of demand measures the responsiveness of change in…

Q: Elasticity of demand is 0.39 If the rise in price is 16% Find the call in quantity demanded

A: According to the above mentioned question, the values are:- The elasticity of demand = Ed = 0.39 %…

Q: Q2. At a given market price of a good a consumer buys 120 units. When price falls by 50 per cent he…

A: Price elasticity of demand is a measure of the degree of responsiveness of changes in demand caused…

Q: The price elasticity of demand for magazines is 0.4. The price elasticity of demand for newspapers…

A: The price elasticity of demand is the degree of responsiveness of change in quantity demanded due to…

Q: The price elasticity of demand along a demand curve with a constant slope: is less than the slope.…

A: Meaning of Price Elasticity of Demand: Price elasticity of demand refers to the extent of change…

Q: Goods which have price elasticity of demand that are elastic find that total revenue: rises with…

A: Elasticity of demand depicts how much consumer responds with the change in price level.

Q: If the price increases by 10%, what would happen to the quantity demanded when the price elasticity…

A: Price elasticity of demand: - Price elasticity of demand measures the responsiveness of change in…

Q: Price elasticity of demand is ___________________________.

A: Elasticity is a very important concept used in economics to determine the change in the quantity…

Q: If you know that your product has a close substitute, you will definitely want to know the…

A: Cross elasticity of demand measures the responsiveness of change in demand due to change in the…

Q: Consider the demand for a good. At price 4, the demand for the good is 25 units. Suppose price of…

Q: If the price elasticity of demand is 5.0 then a 10 percent increase in the price results in a…

A: Price elasticity of demand is a measurement of the change in the consumption of a product in…

Q: Zulaikha wanted to buy 10 kg of rice and Ker Xin wanted to buy RM20 worth of rice. Find the price…

A: Price elasticity of demand can be calculated as follows: Price elasticity of demand=% change in…

Q: elasticty of demand for this good.

A: ‘Price elasticity’ of a good is the response in the demand(DD) of the good as the price(P) of the…

Q: If the price elasticity of demand of for gasoline is 1.8, then a 15% decrease in quantity demanded…

A: Given data: Price elasticity of demand for gasoline is 1.8 Decrease in quantity demanded is 15%

Q: If a price increase from $5 to $7 causes quantity demanded to fall from 150 to 100, what is the…

A: Meaning of Price Elasticity of Demand: The price elasticity of demand refers to the situation…

Q: The demand for a good at 10 per unit is 40 units. Price falls by 5. If price elasticity of demand is…

A: Elasticity is an economic concept that describes how changes in any of a good's or service's…

Q: If the price elasticity of supply of a good is 0.8 and if the price rise by 20% then calculate the…

A: # The formula for elasticity of supply is GIVEN as:- = % Change in quantity supplied / % Change in…

Q: A consumer buys 40 units of a good at a price of Rs. 3 per unit. When price rises to Rs. 4 per unit…

A: Price elasticity of demand: It refers to the goods and services whose demand changes due to the…

Q: The elasticity of demand for some products is affected by the personal values of potential…

A: Price elasticity of demand: - Price elasticity of demand measures the responsiveness of change in…

Question

What would be the answer?

If the price elasticity of demand for a product is 0.5, then a price cut from $3.00o to $2.70 will
Multiple Choice
Increase the quantity demanded by about 50 percent.
decrease the quantity demanded by about 5 percent.
Increase the quantity demanded by about 5 percent.
Increase the quantity demanded by about 20 percent.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Answer

Trending now

This is a popular solution!

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Isabella always spends $50 on red roses each month and simply adjusts the quantity she purchases as the price changes. What can you say about Isabella's elasticity of demand for roses?
The price elasticity of the demand for gasoline is -0.02. The price elasticity of demand for gasoline at Joe’s 66 station is -1.2. Explain what might account for the different elasticities.
What does a price elasticity of demand of 0.39 mean?
Maria has decided always to spend one third of her income on clothing. a. What is her income elasticity of clothing demand? b. What is her price elasticity of clothing demand? c. It Marias tastes change and she decides to spend only one fourth of her income on clothing, how does her demand curve change? What is her income elasticity and price elasticity now?
Plot the price and quantity data given in the demand schedule of exercise 1. Put price on the vertical axis and quantity on the horizontal axis. Indicate the price elasticity value at each quantity demanded. Explain why the elasticity value gets smaller as you move down the demand curve.
If the elasticity of demand for hamburgers equals 21.5 and the quantity demanded equals 40,000, predict what will happen to the quantity demanded of hamburgers when the price increases by 10 percent. If the price falls by 5 percent, what will happen?
The price elasticity of demand for personal computers is estimated to be 2.2. If the price of personal computers declines by 20 percent, what will be the expected percentage increase in the quantity of computers sold?
Suppose you could buy shoes one at a time, miter than in pain. What do you predict the cross-price elasticity for left shoes and right shoes would be?
Economists define normal goods as having a positive income elasticity. We can divide normal goods into two types: Those whose income elasticity is less than one and those whose income elasticity is greater than one. Think about products that would fall into each category. Can you come up with a name for each category?