Try another version of this question
When the local grocery store puts cereal on sale, reducing its price from $4.10 per item to $3.60 per item, the quantity sold increases from 180 per week to 250 per week. This response illustrates which of the following concepts?
Hint
What does this concept represent?
Hint
Let's look at the first part of the formula. How do we find the percentage change in quantity using the midpoint formula?
Hint
How do we express the percentage change in quantity using the variables Q1 (original quantity) and Q2 (new quantity)?
Hint
Now calculate the percentage change in quantity demanded by plugging in the numbers for Q1 and Q2.
percentage change in quantity demanded = Hint
Now let's look at the second part of the formula. How do we find the percentage change in price using the midpoint formula?
Hint
How do we express this using the variables P1 (original price) and P2 (new price)?
Hint
Now plug in the numbers for P1 and P2 to calculate the percentage change in price.
Finally, using the whole formula, calculate the value of the price elasticity of demand for cereal.
price elasticity of demand = Hint
Explain what this result means in words. Then click 'Submit' to compare your answer to ours.
Hint
What does this concept represent?
Let's look at the first part of the formula. How do we find the percentage change in quantity using the midpoint formula?
How do we express the percentage change in quantity using the variables Q1 (original quantity) and Q2 (new quantity)?
Now calculate the percentage change in quantity demanded by plugging in the numbers for Q1 and Q2.
percentage change in quantity demanded = Hint
Now let's look at the second part of the formula. How do we find the percentage change in price using the midpoint formula?
How do we express this using the variables P1 (original price) and P2 (new price)?
Now plug in the numbers for P1 and P2 to calculate the percentage change in price.
Finally, using the whole formula, calculate the value of the price elasticity of demand for cereal.
price elasticity of demand = Hint
Explain what this result means in words. Then click 'Submit' to compare your answer to ours.
Hint
Box 1: Select the best answer
price elasticity of demand
Box 2: Select the best answer
the percentage change in quantity demanded divided by the percentage change in price
Box 3: Select the best answer
the change in quantity divided by the average quantity, multiplied by 100
Box 4: Select the best answer
`\frac{Q_{2}-Q_{1}}{(Q_{2}+Q_{1})\div 2}\times 100`
Box 5: Enter your answer as an integer or decimal number. Examples: 3, -4, 5.5172
Enter DNE for Does Not Exist, oo for Infinity
32.6
Box 6: Select the best answer
the change in price divided by the average price, multiplied by 100
Box 7: Select the best answer
`\frac{P_{2}-P_{1}}{(P_{2}+P_{1})\div 2}\times 100`
Box 8: Enter your answer as an integer or decimal number. Examples: 3, -4, 5.5172
Enter DNE for Does Not Exist, oo for Infinity
-13.0
Box 9: Enter your answer as an integer or decimal number. Examples: 3, -4, 5.5172
Enter DNE for Does Not Exist, oo for Infinity
-2.51
Box 10: Enter your answer as text. This question is not automatically graded.
When the price of cereal falls from $4.10 to $3.60, sales increase from 180 per week to 250 per week. This means that, along the demand curve between $3.60 and 4.1, if the price changes by 1%, the quantity demanded will change by -2.51%.