When the price of a good is $5, the quantity demanded is 120 units per month; when the price is $7, the quantity demanded is 100 units per month. Using the midpoint method, the price elasticity of demand is about
a. 0.55.
b. 1.83.
c. 2.
d. 10.
a
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The lower the nominal interest rate, the
A) greater the quantity of money supplied. B) greater the demand for money. C) smaller the demand for goods and services. D) smaller the quantity of money demanded. E) greater the quantity of money demanded.
Refer to Figure 16-11. If government purchases increase by $100 billion and lead to an ultimate increase in aggregate demand as shown in the graph, the difference in real GDP between point A and point B will be
A) more than $100 billion. B) less than $100 billion. C) $100 billion. D) There is insufficient information given here to draw a conclusion.
Certain hotels offer promotional strategies in which kids under 12 eat free at the hotel's restaurant. This is an example of second-degree price discrimination
Indicate whether the statement is true or false
Suppose that the price of beer goes up due to a higher alcohol tax added. Quantity demanded for beer will ________ and consumer surplus will ________.
A. increase; increase B. increase; decrease C. decrease; increase D. decrease; decrease