Question

A local farmer determines that the demand for their quarts of whole milk is given by

x = 2 −

p2

7

where p is the unit price of a quart, in dollars, and x is the quantity demanded. Round all answers to two decimal places.

(a) Determine the elasticity of demand at a price of $1.25.

E(1.25) =

(b) At what price would demand be unitary?

For demand to be unitary, the price needs to be set at $  per quart.

Answer 1

thank you

solution Demand formula of milk x = 2- p3 Por unit price of a quouit Elasticity of demand = 2 x dad where - P = Price of milk Unit - Q = Quantity demand of price Elasticity – at p = 1.25$ Q = x= 2- = 2-(125) 7 = 2-0.22 +1:78 - 2 = -2X1:05 = 0.357 Elasticity = 1.25 x (-0.357) =-0.251 ( Negative because demand decrease umil increase in Demand = 1 = 2 - p2 7 = 14-12 p2= 7 P=UT p=2.64 P=2164] (at the above demand will be Unitary) 1.70 borice)