  Suppose the demand schedule for burritos is as follows:Quantity Demanded (Income \$30,000)PriceQuantity Demanded (Income \$90,000)\$52025\$61622\$71215\$8810\$94Use the midpoint method to calculate the price elasticity of demand for burritos if the priceincreases from \$7 to \$8 for someone with \$30,000 of income.1.Use the midpoint method to calculate the price elasticity of demand for burritos if the priceincreases from \$7 to \$8 for someone with \$90,000 of income.2.Is demand for burritos elastic or inelastic for customers earning \$30,000? Explain.3.Is demand for burritos elastic or inelastic for customers earning \$90,000? Explain.4.

Question

1. help_outlineImage TranscriptioncloseSuppose the demand schedule for burritos is as follows: Quantity Demanded (Income \$30,000) Price Quantity Demanded (Income \$90,000) \$5 20 25 \$6 16 22 \$7 12 15 \$8 8 10 \$9 4 Use the midpoint method to calculate the price elasticity of demand for burritos if the price increases from \$7 to \$8 for someone with \$30,000 of income. 1. Use the midpoint method to calculate the price elasticity of demand for burritos if the price increases from \$7 to \$8 for someone with \$90,000 of income. 2. Is demand for burritos elastic or inelastic for customers earning \$30,000? Explain. 3. Is demand for burritos elastic or inelastic for customers earning \$90,000? Explain. 4. fullscreen
Step 1

Hello. Since your question has multiple sub-parts, we will solve first three sub-parts for you. If you want remaining sub-parts to be solved, then please resubmit the whole question and specify those sub-parts you want us to solve.

(1)

The mid-point elasticity can be estimated using the following formula: help_outlineImage TranscriptioncloseQ2-01 Q1+Q2 2 Mid -Point elasticity P2-P1 P1+P2 2 fullscreen
Step 2

Here, when income = \$30, 000 and price rises from \$7 to \$8 then quantity changes from 12 units to 8 units. That is, assume P1 = \$7, Q1 = 12 units, P2 = \$8, and Q2 = 8 units. Hence, the mid-point elasticity is help_outlineImage Transcriptionclose8-12 12 8 2 Mid -Point elasticity 8 7 8 7 2 1 x2/- x2 15 20 15 20 1 -3 I II fullscreen
Step 3

(2)

Here, income = \$90, 000 and price rises from \$7 to \$8 then quantity changes from 12 units to 8 units. That... help_outlineImage Transcriptionclose10-15 15 10 2 Mid - Point elasticity= 8-7 8 7 2 2/ x2 15 25 15 25 -3 I I fullscreen

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