Suppose that your demand schedule for pizza is as follows: Price Quantity of Pizzas Demanded Quantity of Pizzas Demanded (Dollars) (Income = $20,000) (Income = $24,000) 8 40 50 10 32 45 12 24 30 14 16 20 16 8 12 Using the midpoint method, your price elasticity of demand as the price of pizzas increases from $10 to $12 is (0.45 / 0.64 / 4.57 / 2.20) if your income is $20,000 and ( 0.64 / 1.57 / 0.45 / 2.20 ) if your income is $24,000. If the price of a pizza is $10, your income elasticity of demand is ( 0.10 / 0.08 / 1.22 / 1.86 ) as your income increases from $20,000 to $24,000. However, if the price of a pizza is $12, your income elasticity is ( 0.10 / 0.08 / 1.86 / 1.22 ) .
Suppose that your demand schedule for pizza is as follows: Price Quantity of Pizzas Demanded Quantity of Pizzas Demanded (Dollars) (Income = $20,000) (Income = $24,000) 8 40 50 10 32 45 12 24 30 14 16 20 16 8 12 Using the midpoint method, your price elasticity of demand as the price of pizzas increases from $10 to $12 is (0.45 / 0.64 / 4.57 / 2.20) if your income is $20,000 and ( 0.64 / 1.57 / 0.45 / 2.20 ) if your income is $24,000. If the price of a pizza is $10, your income elasticity of demand is ( 0.10 / 0.08 / 1.22 / 1.86 ) as your income increases from $20,000 to $24,000. However, if the price of a pizza is $12, your income elasticity is ( 0.10 / 0.08 / 1.86 / 1.22 ) .
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter5: Elastic And Its Application
Section: Chapter Questions
Problem 7PA: Suppose that your demand schedule for pizza is as follows: a. Use the midpoint method to calculate...
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Suppose that your demand schedule for pizza is as follows:
|
Price
|
Quantity of Pizzas Demanded
|
Quantity of Pizzas Demanded
|
|---|---|---|
|
(Dollars)
|
(Income = $20,000)
|
(Income = $24,000)
|
| 8 | 40 | 50 |
| 10 | 32 | 45 |
| 12 | 24 | 30 |
| 14 | 16 | 20 |
| 16 | 8 | 12 |
Using the midpoint method, your price elasticity of demand as the price of pizzas increases from $10 to $12 is (0.45 / 0.64 / 4.57 / 2.20) if your income is $20,000 and ( 0.64 / 1.57 / 0.45 / 2.20 ) if your income is $24,000.
If the price of a pizza is $10, your income elasticity of demand is ( 0.10 / 0.08 / 1.22 / 1.86 ) as your income increases from $20,000 to $24,000. However, if the price of a pizza is $12, your income elasticity is ( 0.10 / 0.08 / 1.86 / 1.22 ) .
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