Given below are the annual demand for movie tickets for youngadults with differing annual income:a) Calculate the price elasticity of demand for both income when price increasesfrom $8 to $10.b) Calculate the income elasticity of demand if the person earning $20,000annually has an increase in income to $24,000 for price $12 and price $16.3Price($)Quantity demanded(income $20,000)Quantity demanded(income $24,000)8 40 5010 32 4512 24 3014 16 2016 8 12
Given below are the annual demand for movie tickets for youngadults with differing annual income:a) Calculate the price elasticity of demand for both income when price increasesfrom $8 to $10.b) Calculate the income elasticity of demand if the person earning $20,000annually has an increase in income to $24,000 for price $12 and price $16.3Price($)Quantity demanded(income $20,000)Quantity demanded(income $24,000)8 40 5010 32 4512 24 3014 16 2016 8 12
Chapter20: Elasticity: Demand And Supply
Section: Chapter Questions
Problem 13E: Using the following equation for the demand for a good or service, calculate the price elasticity of...
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Given below are the annual demand for movie tickets for young
adults with differing annual income:
a) Calculate the
from $8 to $10.
b) Calculate the income elasticity of demand if the person earning $20,000
annually has an increase in income to $24,000 for price $12 and price $16.
3
Price
($)
Quantity demanded
(income $20,000)
Quantity demanded
(income $24,000)
8 40 50
10 32 45
12 24 30
14 16 20
16 8 12
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