Ghose and Han (2014) found that the elasticity of demand for Google Play apps is -3.7. This elasticity applies to a small college town where consumers buy approximately 1000 apps per month. If price rises by 5%, what would the effect on quantity demanded? Would revenue rise or fall?

Ghose and Han (2014) found that the elasticity of demand for Google Play apps is -3.7. This elasticity applies to a small college town where consumers buy approximately 1000 apps per month. If price rises by 5%, what would the effect on quantity demanded? Would revenue rise or fall?

Economics Today and Tomorrow, Student Edition

1st Edition

ISBN:9780078747663

Author:McGraw-Hill

Publisher:McGraw-Hill

Chapter7: Demand And Supply

Section7.2: The Demand Curve And Elasticity Of Demand

Problem 6R

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Ghose and Han (2014) found that the elasticity of demand for Google Play
apps is -3.7.

This elasticity applies to a small college town where consumers buy approximately 1000 apps per month.

If price rises by 5%, what would the effect on quantity demanded? Would revenue rise or fall?

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