Questions:
Question 1
P 0 1 2 3 4 5 6
Qd 60 50 40 30 20 10 0
A. Graph the data above (5)
b. Calculate the elasticity of demand, using the point formula, as price drops from $6 to 5, then from 5 to 4, 4 to 3, 3 to 2, 2 to 1, and, 1 to 0. Show all work
C. Calculate the price elasticity of demand, using the mid point formula, for the same price changes as listed in part b. Show all work
d Why are the numbers in part b and part c different? Explain as they relate to the formulas
e. For each calculation in part c, state: if the price elastic, unitary or inelastic; what portion of the demand curve it is located on (upper, middle or lower); and what is the relationship between the % change in Qd and the % change in P for each calculation;