The short run price elasticity for electricity consumption is -0.20. If the current price of electricity in central Ohio is $0.10 per Kilowatt hour (delivered to your home), and the typical homeowner uses 900 Kilowatt hours per month, what will happen to consumption of electricity for the typical homeowner if price falls by $0.02 per Kilowatt hour?
The short run price elasticity for electricity consumption is -0.20. If the current price of electricity in central Ohio is $0.10 per Kilowatt hour (delivered to your home), and the typical homeowner uses 900 Kilowatt hours per month, what will happen to consumption of electricity for the typical homeowner if price falls by $0.02 per Kilowatt hour?
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter3: Demand Analysis
Section: Chapter Questions
Problem 2E: The price elasticity of demand for personal computers is estimated to be 2.2. If the price of...
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