33. Suppose that the quantity of Pepsi demanded declines from 103,000 gallons per week Go 97,000 gallons per week as a consequence of a 10 per cent increase in the price of Pepsi. The price elasticity of demand din absolute valuê) is: a. 1.66. b. 6.00. (93c00 - 10300) O+0):2) O 0.60. d. 1.40. 10

33. Suppose that the quantity of Pepsi demanded declines from 103,000 gallons per week Go 97,000 gallons per week as a consequence of a 10 per cent increase in the price of Pepsi. The price elasticity of demand din absolute valuê) is: a. 1.66. b. 6.00. (93c00 - 10300) O+0):2) O 0.60. d. 1.40. 10

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 6SCQ: Suppose you are in change of sales at a pharmaceutical company, and your firm has a new drug that...

See similar textbooks

Related questions

Q: QUESTION 3 What will happen to the price elasticity of demand for Ford sport-utility vehicles (SUVS)…

A: Elasticity of demand measures the responsiveness of percentage change in quantity demanded due to…

Q: Suppose the market demand functions for apples an bananas are respectively Qdle = 2500 – 300Papple +…

A: Given Demand function of apple Qdapple=2500-300Papple+200Pbanana ... (1) Papple=5.00 and…

Q: Price elasticity of demand is -1.25. If price increases O A. revenue increases B. revenue decreases…

A: below is the answer.

Q: QUESTION 1 ne price elasticity of demand of a straight-line demand curve is A. 1 at all points on…

A: Answer in step 2

Q: If the elasticity of demand for Good A is -3, a 33 percent decrease in quantity demanded of Good A…

A: The elasticity of demand measures the responsiveness of percentage change in quantity demanded due…

Q: Table 1B: Price Quantity Before: $5.00 30 After: $4.00 40 Refer to Table 1B. Price Elasticity of…

A: Elasticity of demand = - ∆Quantity demanded∆Price* pricequantity demanded

Q: 3. Price rises from $10 to $12, and the quantity demanded falls from 200 units to 180 units. What is…

A: Given: The price level for a good rises from = $10 to $12 The quantity demanded falls from 200 units…

Q: In the figure, what is the price elasticity of demand at the midpoint between points A and B? Price…

A: Price elasticity of demand is the measurement of the sensitiveness of Quantity demand to change in…

Q: 1.Assume that the Price Elasticity of Demand for a product is -.32. Currently, at the price of P…

A: Elasticity is the change in one variable due to the change in some other variable. The price…

Q: Interpret elasticity of demand Question For a certain product, the elasticity of demand when the…

A: We are authorized to answer one question at a time, since you have not mentioned which question you…

Q: Refer to the accompanying figure. At P- 4,w does the price elasticity of demand for D1 compare to…

A: Prize elasticity of demand measures the responsiveness of quantity demanded with respect to change…

Q: 6) a. Given that f is a differentiable function of x, show that the following notation of elasticity…

A: We are going to use rules of differentiation to answer this question.

Q: Consider the price-demand equation given by 6,000- 1, 200 Find E(p), the elasticity of demand. Which…

A: Answer: Given, Demand equation: p=6,000-x1,200Let us convert the above equation into demand-price…

Q: If the price of Moonlight massage oil decreases from $3 to $2.50 and, as a result, total revenue…

A: here we calculate the elasticity of demand by using the total revenue and select the correct option…

Q: Pop's Com Popcorn shop normally sells 100 bags a day when the price is S6 per bag. On half-price…

A: Given: The quantity one for bags per day is = 100 bags The price is = $6 per bag The price now…

Q: Copy of A shop sells 100 mugs per week at $2 each. When it increases the price to $2.5, the number…

A: Price elasticity (EP) of demand is a measure that determines the elasticity of quantity demanded…

Q: QUESTION 23 The demand for a product is inelastic with respect to price if OA the elasticity O B.…

A: In the market, the elasticity of demand is explained by the responsiveness of the consumers'…

Q: Question 2 The price elasticity of demand for heroin is: O Less than 1. O Between 0 and 1.5. O Is…

A: When the price of a product is elastic, a change in the amount requested changes fast. When the…

Q: the price of product A rises, when is the price elasticity of supply likely to be the highest? O…

A: Price elasticity of supply measures the responsiveness of quantity supplied to change in the price…

Q: Suppose the price of a product increases from $12 to $20 and the quantity demanded falls from 55 a…

A: Price elasticity of demand measures the sensitivity of the quantity demanded in response of a change…

Q: Quantity Demanded Quantity Supplied P in USD 100 100 900 700 150 200 500 225 300 300 300 400 100 400…

A: Price elasticity of demand is percentage change in quantity demanded with respect to percentage…

Q: If the demand for American automobiles is more elastic in Europe than it is in the United States, we…

A: Price discrimination is defined as the price strategy in which the firms sell the same commodities…

Q: The Stopdecay Company sells an electric toothbrush for $25. Its sales have averaged 8,000 units per…

A: 4) Without any change in price P= $25 and Q= 6500 If Stopdecay does not change its price, the…

Q: If the demand for American automobiles is more elastic in Europe than it is in the United States, we…

A: Elastic demand is a form of demand in which a minor price change can result in a large change in the…

Q: QUESTION 1 If the price of Pepsi-Cola increases from 40 cents to 50 cents per can and the quantity…

A: The initial price of Pepsi, P = 40 cents Final price of Pepsi, P1 = 50 cents Initial quantity, Q =…

Q: Table 1B: Price Quantity Before: $5.00 20 After: $6.00 16 Refer to Table 1B. Price Elasticity of…

A: Price ($) Quantity Before P1 = 5 Q1 = 20 After P2 = 6 Q2=16 % change in price = [(P2 - P1)…

Q: Interpret elasticity of demand Question For a certain product, the elasticity of demand when the…

A: Given, P = $5, E (5) = 1.1 Elasticity shows the responsiveness of quantity demanded due to the…

Q: 28. Suppose that the quantity of Pepsi demanded declines from 103,000 gallons per week to 97,000…

A: The price elasticity of demand is the change in the percentage of quantity demanded divided by the…

Q: Suppose the elasticity of demand equals -0.5. If a company decreases prices by 10%, quantity…

A: Elasticity of demand measures the responsiveness of quantity demanded to changes in price level.

Q: A local pizzeria raised its price from $9 to $11 for each pizza and the sales of its pizza decreased…

A: Answer: Given: Initial Price = $9 Current Price= $11 Initial quantity =150 current quantity = 100…

Q: If an increase in price from $1 to $2 causes a decrease in quantity demanded from 120 to 100,…

A: Elasticity is used to calculate the relative change in the quantity demanded of the good as compared…

Q: Table 1B: Price Quantity Before: $5.00 30 After: $4.00 40 Refer to Table 1B. Price Elasticity of…

A: Price elasticity of demand refers change in demand due to change in price so here we calculate the…

Q: QUESTION 5 If at a price of $8, the quantity of movie tickets bought will be 3,300 per day, and at…

A: Given: The initial quantity of tickets bought is = 3,300 per day The initial price of the ticket is…

Q: Suppose that the quantity demanded of good X rises from 90 units to 110 units when its orice talls…

A: Quantity Price 90 120 110 100

Q: Refer to Figure 5.5. Using the midpoint method, if the price of a gardenburger is increased from $6…

A: The Mid point formula to calculate elasticity is

Q: For a certain good, when price rises from $100 to $150, quantity demanded falls from 2,000 to making…

A: Answer: Initial price = $100 New price = $150 Initial quantity = 2000 New quantity = 1200…

Q: For product X, the price elasticity of demand has an absolute value of 3.5. This means that quantity…

A: Elasticity = % Increase in quantity demanded / % Decrease in price 3.5 = % Increase in quantity…

Q: For a certain good, when the good's price falls from $12 to $10, its quantity demanded rises from 10…

A: Price elasticity of demand = %age change in QD / %age change in Price

Q: Suppose the price of Twinkies decreases from $1.15 to $0.85 and, as a result, the quantity of…

A: Government uses fiscal policy to increase spending by increasing aggregate demand. This they do by…

Q: QUESTION 8 Which of the following is not characteristic of the demand for a commodity that is…

A: 8. The price elasticity of demand is the responsiveness of the quantity demanded to the change in…

Q: Price falls from $8.50 to $7.75, and the quantity demanded rises from 900 units to 970 units. What…

A: ELASTICITY of demand refers to the percentage change in quantity demanded due to percentage change…

Q: The arc price elasticity of demand between 2006 and 2007 is: -0.21 -0.36 0.36 o 0.21

A: Only the 1st question will be answered. The formula of arc price elasticity is: Arc elasticity of…

Q: It is given that the initial quantity demanded is 40 units when the price of the good is $10. Now,…

A: As per question, "initial quantity demanded = 40 units." Let this initial quantity demanded be…

Q: According to the graph, if price increases from $10 to $15, total revenue will Price $20 15 10 O 1 2…

A: If price increases from $10 to $15, then quantity demanded will fall from 10 to 8 units. Initial…

Q: 20 18 N 10 M 14 10 M N O 10 QUANTITY (Units) 12 14 10 18 20 Using the graph, complete the tabie that…

A: Price elasticity of demand measures the responsiveness of change in demand of a good to a change in…

Q: Refer to Figure 5-2. The elasticity of demand from point A to point B, using the midpoint method…

A: The quantity demanded of a good refers to the amount of good the consumers of the good are willing…

Q: If the price elasticity of demand for coffee is -0.5 and Starbuck's is expecting a 10% increase in…

A: Given information, Price elasticity of demand for coffee: -0.5 Starbuck's percentage change in…

Q: Suppose a firm faces an elasticity of demand of -1 at its current price/quantity levels. This firm…

Q: Figure 34 Quantity (units) 34. In Figure 34, The demand curve in the figure above illustrates the…

A: The elasticity of demand is a measure of sensitiveness of quantity demanded because of a change in…

Concept explainers

Comparative Advantage and Absolute Advantage Analysis

The theory of absolute advantage was given by Adam Smith in the year 1776.

Question

Q33

33. Suppose that the quantity of Pepsi demanded declines from 103,000 gallons per week
Go 97,000 gallons per week as a consequence of a 10 per cent increase in the price of
Pepsi. The price elasticity of demand din absolute valuê) is:
a. 1.66.
b. 6.00.
(93c00 - 10300) O+0):2)
O 0.60.
d. 1.40.
10

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Describe the general appearance of a demand or a supply curve with infinite elasticity.
From the data in Table 5.6 about supply of alarm clocks, calculate the price elasticity of supply from: point J to point K, point L to point M, and point N to point P. Classify the elasticity at each point as elastic, inelastic, or unit elastic.
What is the relationship between price elasticity and position on the demand curve? For example, as you move up the demand curve to higher prices and lower quantities, what happens lo the measured elasticity? How would you explain that?
Suppose you are in change of sales at a pharmaceutical company, and your firm has a new drug that causes bald men to grow hair. Assume that the company wants to earn as much revenue as possible from this drug. If the elasticity of demand for your companys product at the current price is 1.4, would you advise the company to raise the price, lower the price, or to keep the price the same? What if the elasticity were 0.6? What if it were 1? Explain your answer.
The Stopdecay Company sells an electric toothbrush for $25. Its sales have averaged 8,000 units per month over the past year. Recently, its closest competitor, Decayfigh ter, reduced the price of its electric toothbrush from $35 to $30. As a result, Stopde cays sales declined by 1,500 units per month. What is the arc cross elasticity of demand between Stopdecays toothbrush and Decayfighters toothbrush? What does this indicate about the relationship between the two products? If Stopdecay knows that the arc price elasticity of demand for its toothbrush is 1.5, what price would Stopdecay have to charge to sell the same number of units as it did before the Decayfighter price cut? Assume that Decayfighter holds the price of its toothbrush constant at $30. What is Stopdecays average monthly total revenue from the sale of electric toothbrushes before and after the price change determined in part (b)? Is the result in part (c) necessarily desirable? What other factors would have to be taken into consideration?
Can you think of an industry (or product) with near infinite elasticity of supply in the short term? That is, what is an industry that could increase Qs almost without limit in response to an increase in the price?
Suppose you learned that the price elasticity of demand for wheat is 0.7 between the current price for wheat and a price 2 higher per bushel. Do you think that farmers collectively would try to reduce the supply of wheat and drive the price up 2 higher per bushel? Explain your answer. Assuming that they would try to reduce supply, what problems might they have in actually doing so?
What would the gasoline price elasticity of supply mean to UPS or FedEx?
What is the price elasticity of supply? Can you explain it in your own words?
Would you usually expect elasticity of demand or supply to be higher in the short run or in the long run? Why?
(Price Elasticity of Supply) Calculate the price elasticity of supply for each of the following combinations of price and quantity supplied. In each case, determine whether supply is elastic, inelastic, perfectly elastic, perfectly inelastic, or unit elastic. a. Price falls from $2.25 to $1.75; quantity supplied falls from 600 units to 400 units. b. Price falls from $2.25 to $1.75; quantity supplied falls from 600 units to 500 units. c. Price falls from $2.25 to $1.75; quantity supplied remains at 600 units. d. Price increases from $1.75 to $2.25, quantity supplied increases from 466.67 units to 600 units.