In economics, price elasticity refers to an agent's responsiveness to changes in the price. The demand for a good is said to be elastic if a price change causes a large change in quantity demanded (more price sensitive) and is said to be inelastic if a change in the price of the good causes a relatively smaller change in the quantity demanded (less price sensitive). a. Draw a demand curve representing elastic demand and another one representing inelastic demand. Show on the graph why you drew them as such. b. Give an example of a good for which the demand may be price elastic and a good for which the demand may be price inelastic. Briefly explain. c. If producers can set the price freely, would they rather operate in a demand setting where the demand for the good is price elastic or one where the demand for the good is price inelastic? Consider the following benefit schedule for an individual: Number of burgers Total Benefit 20 1 2 3 32 40 46 5 48 a. Compute the marginal benefit of each burger. b. If burgers are $8 each, how many burgers should be consumed? c. Use the table and the logic in (b) to construct a demand curve for this individual. Graph the result with proper scale. d. The consumer has a health scare which causes them to be afraid of burgers. The marginal benefit associated with each burger falls by 2. Draw the consumer's new individual demand curve on the same graph as the one in (c). e. Assume a new consumer enters the market with the same demand curve. Derive the market demand curve if these two consumers make up the entire market and graph it alongside the individual demand curves. (Make a new graph for this one, don't use the same one as (d)).