Until recently, Dave's Donuts sold their premium chocolate-cornflake-cronut for $3.75, and they would sell 55 per week. Now, Dave has raised the price of the chocolate- cornflake-cronut to $4.25, as a result, they are selling only 45 per week. Using the midpoint rule, find the price elasticity of demand for the chocolate-cornflake- cronut at Dave's Donuts. [a]
Until recently, Dave's Donuts sold their premium chocolate-cornflake-cronut for $3.75, and they would sell 55 per week. Now, Dave has raised the price of the chocolate- cornflake-cronut to $4.25, as a result, they are selling only 45 per week. Using the midpoint rule, find the price elasticity of demand for the chocolate-cornflake- cronut at Dave's Donuts. [a]
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter5: Price Elasticity Of Demand And Supply
Section5.3: Determinants Of Price Elasticity Of Demand
Problem 1YTE: According to the previous discussion, what factors influence the price elasticity of demand for...
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Question
![#
2
e
Until recently, Dave's Donuts sold their premium chocolate-cornflake-cronut for $3.75,
and they would sell 55 per week. Now, Dave has raised the price of the chocolate-
cornflake-cronut to $4.25, as a result, they are selling only 45 per week.
d
Using the midpoint rule, find the price elasticity of demand for the chocolate-cornflake-
cronut at Dave's Donuts. [a]
C
54
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f
%
5
t
g
A
6
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20222
y
&
7
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*
120
8
00
j
O
k
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Transcribed Image Text:#
2
e
Until recently, Dave's Donuts sold their premium chocolate-cornflake-cronut for $3.75,
and they would sell 55 per week. Now, Dave has raised the price of the chocolate-
cornflake-cronut to $4.25, as a result, they are selling only 45 per week.
d
Using the midpoint rule, find the price elasticity of demand for the chocolate-cornflake-
cronut at Dave's Donuts. [a]
C
54
$
f
%
5
t
g
A
6
hp
20222
y
&
7
h
O
u
*
120
8
00
j
O
k
O
Expert Solution
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Step 1
When we will use the average percentage change in both quantity and price,then this is called the midpoint method for elasticity and is represented by the following
Price elasticity (mid point )=
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