Remembering the learning activity in Unit 3, in the year 107 WBCE (Way Before the Common Era) the Gondwanaland Chairman of Production reported that the gosum berry growers could meet an average demand of 700 barrels of gosum berries per month at an average a price of $70 per barrel. In the year 108 WBCE, the growers were plagued with a gosum berry bug infestation that reduced average output, causing production to fall to only 600 barrels per month, causing the price to rise to $84 per barrel. The following table shows the chairman’s report: Year (WBCE) Monthly barrels of gosum berries demanded Price per barrel 107 700 $70 108 600 $84 Using the midpoint method, calculate the price elasticity of demand for Gondwanaland gosum berries. Explain what this price elasticity of demand means?
Remembering the learning activity in Unit 3, in the year 107 WBCE (Way Before the Common Era) the Gondwanaland Chairman of Production reported that the gosum berry growers could meet an average demand of 700 barrels of gosum berries per month at an average a price of $70 per barrel. In the year 108 WBCE, the growers were plagued with a gosum berry bug infestation that reduced average output, causing production to fall to only 600 barrels per month, causing the price to rise to $84 per barrel. The following table shows the chairman’s report: Year (WBCE) Monthly barrels of gosum berries demanded Price per barrel 107 700 $70 108 600 $84 Using the midpoint method, calculate the price elasticity of demand for Gondwanaland gosum berries. Explain what this price elasticity of demand means?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Remembering the learning activity in Unit 3, in the year 107 WBCE (Way Before the Common Era) the Gondwanaland Chairman of Production reported that the gosum berry growers could meet an average
In the year 108 WBCE, the growers were plagued with a gosum berry bug infestation that reduced average output, causing production to fall to only 600 barrels per month, causing the price to rise to $84 per barrel. The following table shows the chairman’s report:
|
Year (WBCE) |
Monthly barrels of gosum berries demanded |
Price per barrel |
|
107 |
700 |
$70 |
|
108 |
600 |
$84 |
- Using the midpoint method, calculate the
price elasticity of demand for Gondwanaland gosum berries. Explain what this price elasticity of demand means?
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