1. Determine the price elasticity of demand at each quantity

demanded. Go from $5 to $10 then from $10 to $15 to $20

and so on.

1. Plot the price and quantity data. Indicate the price elasticity

value at each point. Illustrate your result on a downward sloping demand curve.

1. What happens to the elasticity value as you move down the

demand curve?

PriceQuantity Demanded

$5100

1080

1560

2040

2520

3010

answer the following questions:

1. To compute the P.E.D. we divide the ____________by___________.
2. If a 10% increase in price decreases the quantity demanded by 12% the P.E.D. is __?
3. What happens to PED coefficient as we move down the demand curve?
4. Explain why audio tapes are more elastic in the long-run than in the short-run?