Question

Given the following price-demand function, find the elasticity of demand, E(p), and determine whether demand is elastic, inelastic, or has unit elasticity for the following values of p. (Round your answers to two decimal places.) x = 104,544 - 32p2 (a) p = 43 E(P) = Determine the demand. O elastic O inelastic O unit elasticity (b) p = 30 E(P) = Determine the demand. O elastic O inelastic O unit elasticity (c) p = 50 E() = Determine the demand. O elastic O inelastic O unit elasticity

Answer 1

Elasticity of demand= dx/dp * p/x

dx/dp = =-64 p

A)

When p= 43, x = 45376

So, elasticity of demand = -64 p *p/x = -64(43)^2 / 45376 = -2.61

So, Demand is elastic.

B) when p = 30, x = 75744

So, elasticity of demand= -64*(30)^2/ 75744 =- 0.76

So, demand is inelastic.

C) when p = 50, x = 24544

So, elasticity of demand = -64*(50)^2/24544 =- 6.52

So, demand is elastic.