The first two questions will deal with the market for a particular type of pharmaceutical used to treat chronic pain. When the drug sells for $60 per one-month supply, 8,000 units are sold. When the drug sells for $40 per one-month supply. 10,000 units are sold. (When I say "unit" here, I mean "one-month supply.") Calculate price elasticity of demand, given this information. Be sure to carefully follow all numeric directions; round intermediate steps to four decimal places and your final answer to two. You will interpret your answer in the next question.
The first two questions will deal with the market for a particular type of pharmaceutical used to treat chronic pain. When the drug sells for $60 per one-month supply, 8,000 units are sold. When the drug sells for $40 per one-month supply. 10,000 units are sold. (When I say "unit" here, I mean "one-month supply.") Calculate price elasticity of demand, given this information. Be sure to carefully follow all numeric directions; round intermediate steps to four decimal places and your final answer to two. You will interpret your answer in the next question.
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter5: Elasticity
Section: Chapter Questions
Problem 6SCQ: Suppose you are in change of sales at a pharmaceutical company, and your firm has a new drug that...
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