Q3.

Price ($)

Quantity demanded per week

Quantity supplied per week

20

20

0

40

16

4

60

12

8

80

8

12

100

4

16

a) What is the price elasticity of demand when the price increases from $40 to $60?

b) What is the effect of a price increase from $40 to $60 on the total revenue?

c) Calculate the price elasticity of supply following a price increase from $60 to $80