When the price of a bar of chocolate is $1.00, the quantity demanded is 100,000 bars. When

Question:

When the price of a bar of chocolate is $1.00, the quantity demanded is 100,000 bars. When the price rises to $1.50, the quantity demanded falls to 60,000 bars. Calculate the price elasticity of demand using the mid-point method.

a. Suppose price increases from $1 to $1.50. Calculate the price elasticity of demand.

b. Suppose price decreases from $1.50 to $1. Calculate the price elasticity of demand.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Microeconomics

ISBN: 978-1259813337

2nd edition

Authors: Dean S. Karlan, Jonathan J. Morduch

Question Posted: Oct 03, 2018 11:23 AM

See More Questions

When the price of a bar of chocolate is $1, demand is 100,000 bars. When the price rises to $1.50, demand falls to 60,000 bars. Calculate the price elasticity of demand according to the instructions...
Alexander spends all his money on chocolate bars and songs that he downloads. The price of a chocolate bar and of a song is $ 1 each. His parents give him an allowance of $ 50 and four chocolate bars...
Diogo's utility function is U(q1, q2) = q10.75q20.25, where q1 is chocolate candy and q2 is slices of pie. If the price of a chocolate bar, p1, is $1, the price of a slice of pie, p2, is $2, and Y is...
A 1.0 m long metallic rod is rotated with an angular frequency of 400 rad s about an axis normal to the rod passing through its one end. The other end of the rod is in contact with a circular...
The charter for ASAP-TV, Inc. authorizes the company to issue 100,000 shares of $5, no-par preferred stock and 500,000 shares of common stock with $1 par value. During its start-up phase, ASAP-TV...
Discuss why surveillance is central to the effectiveness of public health.
What were the major catalysts for the fall of the dot coms? LO.1
Refer to the income statement in C 2 for the state Institutions customer group for the year ended December 31, this year. Sandee Star, the owner of Star Bakery, is in the process of budgeting income...
i need help finding #32 & statement in changes of retained earnings Byte of Accounting, Inc. Description of transaction June 1: Byte of Accounting, Inc. issued 2.660 shares of its common stock to...
The water clock (clepsydra) shown in Fig. P3.101 is an ancient device for measuring time by the falling water level in a large glass container. The water slowly drains out through a small hole in the...
You are advising a coffee shop manager who wants to estimate how much sales will change if the price of a latte rises. You tell him that he should measure the change in sales using the percentage...
Explain why the coffee shop manager should calculate elasticity using the mid-point method.
The Rolling Department of Keystone Steel Company had 400 tons in beginning work in process inventory (20% complete). During the period, 7,900 tons were completed. The ending work in process inventory...
(b) A cylindrical storage tank with base area 90 m is being filled with water through an entry duct with cross-section area 250 cm, as shown in Figure 3. Concurrently, water is being extracted from...
Po A cylinder/piston arrangement contains 5 kg of water at 100 C with x= 20%. Initially the piston of mass m, 75 kg rests on a set of stops (see figure). The outside pressure is 100 kPa, and the area...
TABLE 2 Present Value of an Annuity of $1 n 123456 8% 9% 0.925926 0.917431 4 7 8 9 10 11 12 13 14 15 16 17 11.652296 10.837770 10.105895 9.446649 12.165669 11.274066 10.477260 9.763223 18 19...
There are 4 suits (heart, diamond, clover, and spade) in a 52-card deck, and each suit has 13 cards. Suppose your experiment is to draw one card from a deck and observe what suit it is. Express the...
Write isotopic symbol of zirconium and how many neutrons are present in one atom of this isotope
Convert each decimal number to binary. 39
Using Apple, demonstrate how the differentiation strategy can be well implemented.
Consider a labor market that traditionally discriminates against hiring women. Suppose a new law effectively prohibits this practice. What would you expect to happen to the wages of men in this...
Based on Table 16P-3, indicate what would happen in this labor market at various wage rates by selecting one of the three choices shown for each item. a. At $8/hour: excess labor supply; excess labor...
Suppose you run a business that specializes in producing graphic T-shirts, using labor as an input. Based on Table 16P-2, graph the labor supply and demand curves and identify the market equilibrium...
explain the concept of Time Value of Money and provide and example. In addition to your discussion, please explain the differences between Stocks and Bonds
Wildhorse Inc. has just paid a dividend of $3.80. An analyst forecasts annual dividend growth of 9 percent for the next five years; then dividends will decrease by 1 percent per year in perpetuity....
Jenny wanted to donate to her alma mater to set up a fund for student scholarships. If she would like to fund an annual scholarship in the amount of $6,000 and her donation can earn 5% interest per...

When the price of a bar of chocolate is $1.00, the quantity demanded is 100,000 bars. When

Question:

Step by Step Answer:

a 60000 10000080000150 100125 125 b ...View the full answer

Microeconomics

Students also viewed these Business questions