To calculate elasticity along a demand or supply curve economists use the average percent change in both quantity and price. This is called the Midpoint Method for Elasticity, and is represented in the following equations: $150 $120 P $90 7. Referring to the information in the demand curve below, calculate the price elasticity of demand as price decreases from $90 at point D to $80 at point C. Be sure to show all calculations here. $60 $40 1,500 % change in quantity: % change in price = H (1600,130) Jeesus F (2000,110) E (2200,100) (2400,90) (2600,80) (1800,120) 22-21 (22+21)/2 P2-P₁ (P2+P1)/2 2,000 Q x 100 2,500 x 100 C (2800,70) B A (3000,60) 3,000
To calculate elasticity along a demand or supply curve economists use the average percent change in both quantity and price. This is called the Midpoint Method for Elasticity, and is represented in the following equations: $150 $120 P $90 7. Referring to the information in the demand curve below, calculate the price elasticity of demand as price decreases from $90 at point D to $80 at point C. Be sure to show all calculations here. $60 $40 1,500 % change in quantity: % change in price = H (1600,130) Jeesus F (2000,110) E (2200,100) (2400,90) (2600,80) (1800,120) 22-21 (22+21)/2 P2-P₁ (P2+P1)/2 2,000 Q x 100 2,500 x 100 C (2800,70) B A (3000,60) 3,000
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:To calculate elasticity along a demand or supply curve economists use the average percent
change in both quantity and price. This is called the Midpoint Method for Elasticity, and is
represented in the
following
equations:
$150
$120
P $90
7. Referring to the information in the demand curve below, calculate the price elasticity of
demand as price decreases from $90 at point D to $80 at point C. Be sure to show all
calculations here.
$60
$40
1,500
% change in quantity:
% change in price =
H
(1600,130)
Jeesus
F (2000,110)
E (2200,100)
(2400,90)
(2600,80)
(1800,120)
22-21
(22+21)/2
P2-P₁
(P2+P1)/2
2,000
Q
x 100
2,500
x 100
C
(2800,70)
B
A
(3000,60)
3,000
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