Suppose that the price of a head of lettuce increases from $1 to $2, and this...

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Pnce 100 200 300 500 Quantly

Suppose that the price of a head of lettuce increases from $1 to $2, and this causes consumption of lettuce to decrease from 40 heads to 20 heads. Show this change in a graph. (Be sure to label the axes, the curve and the two price points in the graph) (1 point)

According to the graph, if price decreases from $18 to $12,

What is the percentage change in price using the midpoint method? (Provide the formula and your calculations.) (0.5 points)
What is the percentage change in quantity using the midpoint method? (Provide the formula and your calculations.) (0.5 points)
What would be the price elasticity of demand when prices decreases from $18 to $12? (Provide the formula and your calculations.) (0.5 points)

Answer 1

Answer #1

4.S u 3.5 & 3 3 doned T 2.5 A (20,2) 1 2 Lettuce 1.5 B (10, 1) 1 .O.S. 0 S los 20 25 30 35 40 US So ss dettuce Quantity

C Pi=18 P2 = 12 Q=100 22 300 Midpolut method: 7. A in price 112-P1 | Xloo Pi 12-18 - too 18 --33.33% Y. A in Qd 17 22-9x ) tl

Midpoint formula for Elasticity of demand = Y AQJ у Р 200. -33.33% 6.00 Ed = -6

answered by: ANURANJAN SARSAM

Answer 2

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