Question 9Suppose that the price elasticity of demand is -0.80 for aspirin. We could then say that the demandfor aspirin isO infinitely elastic.unable to be determined with the provided information.inelastic.unitary elastic.elastic.

The law of demand's main idea is price elasticity of demand (PED). It is an economic measure of how…

Answered: Question 9 Suppose that the price…

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter20: Elasticity: Demand And Supply

Section: Chapter Questions

Problem 11E: The price elasticity of the demand for gasoline is -0.02. The price elasticity of demand for...

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The price elasticity of demand for personal computers is estimated to be 2.2. If the price of personal computers declines by 20 percent, what will be the expected percentage increase in the quantity of computers sold?
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?
If a decrease in the price of movie tickets increases the total revenue of movie theaters, this is evidence that demand is a. price elastic. b. price inelastic. c. unit elastic with respect to price. d. perfectly inelastic.
The president of Tucker Motors says, Lowering the price wont sell a single additional Tucker car. The president believes that the price elasticity of demand is a. perfectly elastic. b. perfectly inelastic. c. unitary elastic. d. elastic.
What does a price elasticity of demand of 0.39 mean?
The price elasticity of the demand for gasoline is -0.02. The price elasticity of demand for gasoline at Joe’s 66 station is -1.2. Explain what might account for the different elasticities.

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Question 9 Suppose that the price elasticity of demand is -0.80 for aspirin. We could then say that the demand for aspirin is O infinitely elastic. O unable to be determined with the provided information. O inelastic. O unitary elastic. O elastic.