Qecon210 Flashcards l Quizlet ×y Aplia: Student Question 9 Eleanor EnOys consumi

Question

Qecon210 Flashcards l Quizlet ×y Aplia: Student Question 9 Eleanor EnOys consuming Box × > C Secure https://courses.aplia.com atiseret quiz?quiz actionstakeQuiz&quiz probGuid-Q4PLC0A8010100000042ef6040050000&ctx-dan.pynn-0005&ck=m,1537574575730 OAAA6BD". 280 180- 140--- - 40 QUANTITY (Units) For each region on the graph given in the roilowing tabie, use the midpoint method to identify whether the demand for this good is elastic, (approximately) unit elastic, or inelastic. Region Elastic Inelastic Unit Elastic Between Y and Z Between X and Y Between W and X True or False: The value of the price elasticity of demand is equal to the slope of the demand curve True False Grade It Now Save & Continue Timeout 59-34

Explanation / Answer

Elasticity of demand = (P1 + P2)/(Q1 + Q2) x (Q2 - Q1)/(P2 - P1)

Between Y and Z:

P1 = 140, P2 = 40, Q1 = 45 and Q2 = 70

Ed = 180/135 x 25/- 100 = - 45/135 = - 0.33 (Inelastic)

Between X and Y:

P1 = 180, P2 = 140, Q1 = 35 and Q2 = 45

Ed = 320/80 x 10/(-40) = - 1 (Unit Elastic)

Betwen W and X:

P1 = 280, P2 = 180, Q1 = 10 and Q2 = 35

Ed = 460/45 x 25/(-100) = - 2.55 (Elastic)

False, price elasticity of demand is not equal to slope of demand curve.

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