Question

Scenario 1: Suppose that the demand for artichokes (Qa) is given as: Qa= 200 - 4P 14) Use the information in Scenario 4.2. What is the price elasticity of demand if the price of artichokes is $10? A) 0 B) -0.25 C) -1 D -4 E) negative infinity 15) Use the information in Scenario 4.2. Suppose that the price of artichokes is increased slightly from $10. The total expenditure by consumers on artichokes will_ and the number of artichokes sold will A) rise, rise B) rise, fall C) fall, rise D) fall, fall 16) Use the information in Scenario 4.2. At what price, if any, is the demand for artichokes completely elastic? A) 50 B) 30 C) 10 D) 0 E) none of the above

Answer 1

Q = 200 - 4P do 3-4 when P= 10, Q = 200 - 4(10) = 160 - 0.25 4 (160 -4 (10) Elasticity = do B) - 0.25 de e is Q = cossed 160 15 B) rise , fall Increase in price leads to decrease in quantity but to increase in price will be greater than 1 decrease in quantity because demand is inclestic sold 16) elasticity - - 4 P = -1 200-4p 4P = 200 - 98 P=25 E) none of the above