When the local used bookstore prices economics books at $15.00 each, they generally sell 70 books per month. If they lower the price to $7.00, sales increase to 90 books per month.Given this information, we know that the price elasticity of demand for economics books is about 0.34, and an increase in price from $7.00 to $15.00 results in a decrease in total revenue. 2.91, and an increase in price from $7.00 to $15.00 results in an increase in total revenue. 2.91, and an increase in price from $7.00 to $15.00 results in a decrease in total revenue. 0.34, and an increase in price from $7.00 to $15.00 results in an increase in total revenue.

Price elasticity of demand (PED) is the responsiveness of a percentage change in quantity demanded…

Answered: When the local used bookstore prices…

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 7E: In an attempt to increase revenues and profits, a firm is considering a 4 percent increase in price...

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When the local used bookstore prices economics books at $15.00 each, they generally sell 70 books per month. If they lower the price to $7.00, sales increase to 90 books per month.Given this information, we know that the price elasticity of demand for economics books is about

		0.34, and an increase in price from $7.00 to $15.00 results in a decrease in total revenue.
		2.91, and an increase in price from $7.00 to $15.00 results in an increase in total revenue.
		2.91, and an increase in price from $7.00 to $15.00 results in a decrease in total revenue.
		0.34, and an increase in price from $7.00 to $15.00 results in an increase in total revenue.

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