1. Trek Inc., which sells bikes, changed the price of their foldable bikes from P3,000 to P3,500. As a result, the quantity of their product sold went from 700 bikes to 500 bikes. Compute for the price elasticity of demand. Indicate whether the product’s demand is elastic or inelastic. 2. Miko is a collector of matchbox cars. He used to buy five (5) cars every payday. However, when his income was raised from P17,000 to P20,000, he started to buy 10 cars. What is the income elasticity of demand?
1. Trek Inc., which sells bikes, changed the price of their foldable bikes from P3,000 to P3,500. As a result, the quantity of their product sold went from 700 bikes to 500 bikes. Compute for the price elasticity of demand. Indicate whether the product’s demand is elastic or inelastic. 2. Miko is a collector of matchbox cars. He used to buy five (5) cars every payday. However, when his income was raised from P17,000 to P20,000, he started to buy 10 cars. What is the income elasticity of demand?
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter5: Elasticity
Section: Chapter Questions
Problem 1SCQ: From the data in Table 5.5 about demand for smart phones, calculate the price elasticity of demand...
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1. Trek Inc., which sells bikes, changed the price of their foldable bikes from P3,000 to P3,500. As a
result, the quantity of their product sold went from 700 bikes to 500 bikes. Compute for the price
elasticity of demand. Indicate whether the product’s demand is elastic or inelastic.
2. Miko is a collector of matchbox cars. He used to buy five (5) cars every payday. However, when
his income was raised from P17,000 to P20,000, he started to buy 10 cars. What is the income
elasticity of demand?
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