Answered: quantity demanded decreases by 5%.…

Business

Economics

quantity demanded decreases by 5%. Using our elasticity formula, calculate price elasticity and

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter5: Price Elasticity Of Demand And Supply

Section: Chapter Questions

Problem 2SQ

See similar textbooks

Related questions

Q: A 3 percent decrease in the price of milk causes a 12 percent increase in the quantity demanded of…

A: Cross-price elasticity (XED) measures the responsiveness of the quantity demanded of one good to a…

Q: Calculate the price elasticity of demand. Given that when price changes by 10%, the quantity changes…

A: Here we calculate the price elasticity of demand by using the given information , so the calculation…

Q: A 10 percent decrease in the price of coffee leads to a 20 percent decrease in the quantity of tea…

A: Scarcity of resource takes place due to finite resources and unlimited wants factor. Because…

Q: Your research estimates the (own) price elasticity of demand for coffee as 0.78 in absolute terms.…

A: demand refers to the amount of goods and services needed by the consumers.

Q: why is the price elasticity of coca cola greater than the price elasticty of soft drinks?

A: Price elasticity of demand: It is used for measuring the change in consumption of a product in…

Q: The price of a laptop computer increases by 10%, and we observe a 20% decrease in quantity demanded.…

A: Here, given information is: Percentage change in price of laptop: 10% Percentage change in quantity…

Q: The price of a smartphone brand was initially $500, and the quantity demanded per month was 1000…

A: Cross elasticity of demand: It is an economic term that measures the change or response of the…

Q: Determine the cross elasticity of demand, if the price of gasoline has risen from 10 rubles per…

A: Cross price elasticity of demand measures the responsiveness in quantity demanded of a commodity to…

Q: Suppose the price of rice increases from $0.80 to $1.00 a gram and the quantity demanded decreases…

A: The price elasticity of demand shows the responsiveness of demand with the change in price. The…

Q: Your research into the spice market shows that when the price of spices increases by 5%, the…

A: The markets are the place where the buyers and the sellers of the goods, services, and other…

Q: Calculate price elasticity of demand if quantity demanded fell from 50 to 35, which corresponds with…

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

Q: CALCULATE THE PRICE ELASTICITY OF DEMAND GIVEN THAT WHEN PRICE CHANGES BY 10% THE QUANTITY CHANGES…

A: # The formula for elasticity of demand is given as: Ed = % Change in quantity/% change in price.

Q: Assume the cross-elasticity of demand for car tires with respect to the price of cars is 2. What…

A: The cross price elasticity measures the responsiveness of quantity demanded for one good to the…

Q: A 50% increase in the price of oak wood has increased the quantity demanded of pine wood by 10%.…

A: Cross-price elasticity is measured by the percentage change in the quantity demanded of one good…

Q: Calculate accurately Suppose 10 units of a good are sold when the price is $2 per unit,…

A: The elasticity of demand refers to the percentage change in the quantity of demand due to changes in…

Q: d

A: Cross-price elasticity of demand is used to measure the responsiveness of the quantity demanded for…

Q: Suppose the cross-price elasticity of apples with respect to the price of oranges is 0.4, and the…

A: Cross Price elasticity can be defined as ratio between the percentage change in quantity demanded…

Q: Price of beef increases by 12% and the quantity of beef demanded falls by 10%. Calculate the…

A: Elasticity of Demand: Elasticity of Demand is the degree of responsiveness of demand to changes in…

Q: Calculate the price elasticity of demand of Cornelio's Buko Pie if the price of Buko Pie rises by…

A: Price elasticity of demand represents quantity demanded is changed due to the result of a change in…

Q: When the price of a given type of hamster chow increased by 22%, 22% more units were produced and…

A: Elasticity measures the responsiveness of quantity to changes in price

Q: Determine the cross elasticity of demand, if the price of gasoline has risen from 10 rubles per…

A: Cross elasticity of demand = %change in the quantity of a good / %change in the price of another…

Q: The price of a package of Reese's Peanut Butter Cups rises from $1.00 to $1.25. As a result, the…

A: Price elasticity of demand is calculated as the ratio of % change in quantity demanded to the…

Q: When the price of gasoline rises by 3 % the quantity demanded falls by 0.12 % . Calculate the price…

A: Here, Given information is: Percentage change in the price of gasoline: 3% Percentage change in the…

Q: When price of a good is 13 per unit, the consumer buys 11 units of that good. When price rises to 15…

A: The price elasticity of demand measures the change in consumption of a product or service in…

Q: Calculate the cross price elasticity of demand if demand of a product is changed by 10 % when there…

A: Cross price elasticity of demand = % change in the quantity of a good / % change in the price of…

Q: The price of a smartphone brand was initially $500, and the quantity demanded per month was 1000…

A: Price elasticity of demand:Price elasticity of demand measures the responsiveness of 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: As the price of pizza falls by 10%, the quantity of burgers decreases by 15%. Calculate the…

A: Given data: Price of pizza falls by 10% Quantity of burgers decreased by 15%

Q: The price elasticity of demand for cigarettes is approximately -0.5. Based on this information, is…

A: Elasticity measures the responsiveness of quantity demanded to changes in price level.

Question

The price of oranges increases by 5%, and the quantity demanded decreases by 5%. Using our elasticity formula, calculate price elasticity and interpret if it is price elastic, inelastic, or unit elastic.

Expert Solution

This question has been solved!

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

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps with 1 images

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

What does a price elasticity of demand of 0.39 mean?
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?
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.
On Tuesday, the price and quantity demanded are 7 and 120 units, respectively. Ten days later, the price and quantity demanded are 6 and 150 units, respectively. What is the price elasticity of demand between the 7 and 6 prices?
What are the major determinants of a products price elasticity of demand? Studies indicate that the demand for Florida oranges, Bayer aspirin, watermelons, and airfares to Europe are elastic. Why?
Using the following equation for the demand for a good or service, calculate the price elasticity of demand (using the point form), cross-price elasticity with good x and income elasticity. Q=82P+0.10I+Px Q is quantity demanded, P is the product price. P1 is the price of a related good, and I is income. Assume that P= $10, I = 100, and Px = 20.
Prove that price elasticity of demand is not the same as the slope of a demand curve.
Suppose a university raises its tuition from 3,000 to 3,500. As a result, student enrollment falls from 5,000 to 4,500. Calculate the price elasticity of demand. Is demand elastic, unitary elastic, or inelastic?
Suppose a movie theater raises the price of popcorn 10 percent, but customers do not buy any less popcorn. What does this tell you about the price elasticity of demand? What will happen to total revenue as a result of the price increase?
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?
(Other Elasticity Measures) Complete each of the following sentences: a. The income elasticity of demand measures, for a given price, the __________ in quantity demanded divided by the __________ income from which it resulted. b. If a decrease in the price of one good causes a decrease in demand for another good, the two goods are __________. c. If the value of the cross-price elasticity of demand between two goods is approximately zero, they are considered __________.
Suppose that your demand schedule for pizza is as follows: a. Use the midpoint method to calculate your price elasticity of demand as the price of pizza increases from 8 to 10 if (i) your income is 20,000 and (ii) your income is 24,000. b. Calculate your income elasticity of demand as your income increases from 20,000 to 24,000 if (i) the price is 12 and (ii) the price is 16.