**Title: Calculating Price Elasticity of Demand Using the Midpoint Method**---**Price Elasticity of Demand Formula:**To calculate the price elasticity of demand using the midpoint method, use the following formula:\[ E_d = \frac{(Q_2 - Q_1) / \left(\frac{Q_1 + Q_2}{2}\right)}{(P_2 - P_1) / \left(\frac{P_1 + P_2}{2}\right)} \]Where:- $ Q_1 $ and $ Q_2 $ are the initial and new quantities demanded- $ P_1 $ and $ P_2 $ are the initial and new prices**Example Scenario:**For a particular video game, the company sells 160,000 copies of the game when the price is $55. However, when they change the price to $45, the company sells 240,000 copies of the game.**Questions:**a. **Change in Quantity**: What is the percent change in quantity using the midpoint method? Round your answer to 4 decimal places if necessary.b. **Change in Price**: What is the percent change in price using the midpoint method? Round your answer to 4 decimal places if necessary.c. **Price Elasticity Calculation**: Using parts a and b, calculate the price elasticity of demand. Round your answer to 2 decimal places if necessary.---**ECON 150: Microeconomics**This content is designed to help students understand how to calculate and interpret the price elasticity of demand using practical examples.

The company sells 160 video games when a price = of 55 as the Price falls to 45 now the company is…

What is the formula for calculating the price elasticity of demand using the midpoint method (this equation should involve Q, and Q₂, P₁ and P₂) (It is okay to include the x100% on the top and bottom parts if you would like.) For a particular video game, the company sells 160 (thousand) copies of the game when the price of the game is $55. However, when they change the price to $45, the company sells 240 (thousand) copies of the game. a. As part of the process of finding the price elasticity of demand, what is the percent change in quantity using the midpoint method? Round your answer to 4 decimal places if necessary.

What is the formula for calculating the price elasticity of demand using the midpoint method (this equation should involve Q, and Q₂, P₁ and P₂) (It is okay to include the x100% on the top and bottom parts if you would like.) For a particular video game, the company sells 160 (thousand) copies of the game when the price of the game is $55. However, when they change the price to $45, the company sells 240 (thousand) copies of the game. a. As part of the process of finding the price elasticity of demand, what is the percent change in quantity using the midpoint method? Round your answer to 4 decimal places if necessary.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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