Question

Assignments ECONO 2202-010 (4) Adam Kow Homework: Homework 5 2 of 12 (3 complete) HW Score: 89 Score: 0 of 1 pt X End of Chapter 1.8 Ques You own a hot dog stand that you set up outside the student union every day at lunch time. Currently you are selling hot dogs for a price of $3, and you sell 30 hot dogs a day (point A on the diagram to the right). You are considering cutting the price to $2. The graph to the right shows two possible increases in the quantity sold as a result of your price cut. Use the information in the graph (new quantities are given on the horizontal axis) to calculate the price elasticity between these two prices on each of the demand curves. Use the midpoint formula to calculate the price elasticities. Price (dollars per hot dog) On the demand curve containing the points "A" and "B", the price elasticity of demand for a price cut from $3 to $2 is (Hint: Include the negative sign and enter your response rounded to two decimal places) R70 0 10 20 30 40 50 60 70 80 Enter your answer in the answer box and then click Check Answer. part remaining Clear All Check Answe

Answer 1

On the demand care containing the pointi "A" and "B", the Price elanhcity of demand to a price cul from 3 to 42 ei 2 Q=30 A = B = P = $3 P = $2 2-70 price elashety of demand a. 1 b/w A lud B (midpoint formula) - 70-30 70430 2- Similarly Price elasticity of = Q2-01 P2 - P . deinand b/w A and C auto ste Q2 = 42, P2 = 27 A 42-30 = 2-3 0, -30, P,=3 c 42130 213 -083