You are an analyst. Your friend started a new business of selling masks. She knows that you have adequate knowledge of economics and business, and hence, asked for your help in making some important business decisions. From the data obtained from her, you computed the Price Elasticity of Demand (PED) of Masks, and found PED in February was 1.8 (absolute value), and PED of Masks in April was 0.7 (absolute value). (a) What type of good mask is in the month of April in terms of elasticity? (b) The market price of the mask in June was 10 taka per unit and revenue earned in June was 150 taka. How many masks were sold in June? (c) In 2(b), you found the quantity demanded masks in June. You received the data for August and observed that the price in August was 25 per unit and the quantity demanded of masks in August is 7. Calculate the Price Elasticity of Demand (PED) for masks from June to August.

You are an analyst. Your friend started a new business of selling masks. She knows that you have adequate knowledge of economics and business, and hence, asked for your help in making some important business decisions. From the data obtained from her, you computed the Price Elasticity of Demand (PED) of Masks, and found PED in February was 1.8 (absolute value), and PED of Masks in April was 0.7 (absolute value). (a) What type of good mask is in the month of April in terms of elasticity? (b) The market price of the mask in June was 10 taka per unit and revenue earned in June was 150 taka. How many masks were sold in June? (c) In 2(b), you found the quantity demanded masks in June. You received the data for August and observed that the price in August was 25 per unit and the quantity demanded of masks in August is 7. Calculate the Price Elasticity of Demand (PED) for masks from June to August.

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

Chapter4: Estimating Demand

Section: Chapter Questions

Problem 1.2CE: Interpret the coefficients and calculate the price elasticity of soft drink demand.

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