Recently in Texas, the price of twinkies fell from $.80-$.70, as a result, the quantity demanded of cakes decreased from 120 to 100. What would be the appropriate elasticity to compute using the midpoint method. Compute this elasticity. What does your answer tell you?

answer

watching

views

For unlimited access to Homework Help, a Homework+ subscription is required.

You have 0 free answers left.
Get unlimited access to 3.8 million step-by-step answers.

Get unlimited access

Already have an account? Log in

Joshua StredderLv10

28 Sep 2019

Unlock all answers

Get 1 free homework help answer.

Already have an account? Log in

Related questions

Using the midpoint formula for calculating the elasticity of demand, if the price of a good fell from $42 to $38, what would be the elasticity of demand if the quantity demanded changed from:

a. 19 to 21

b. 27 to 33

c. 195 to 205

copperllama281

Suppose an increase in supply lowers the price from 10 to 8 and increases the quantity demanded from 100 to 130. Using the midpoint method, what is the elasticity of demand equals to?

tanmacaw328

2. In the United States, 2007 was a bad year for growing wheat. And as wheat supply decreased, the price of wheat rose dramatically, leading to a lower quantity demanded (a movement along the demand curve). The accompanying table describes what happened to prices and the quantity of wheat demanded. 2006 2007 Quantity demand (bushels) 2.2 billion 2.0 billion Average price (per bushel) $3.42 $4.26 a. Using the midpoint method, calculate the price elasticity of demand for winter wheat. b. What is the total revenue for U.S. wheat farmers in 2006 and 2007? c. Did the bad harvest increase or decrease the total revenue of U.S. wheat farmers? How could you have predicted this from your answer to part a? 3. A recent study determined the following elasticities for Volkswagen Beetles: Price elasticity of demand = 2 Income elasticity of demand = 1.5 The supply of Beetles is elastic. Based on this information, are the following statements true or false? Explain your reasoning. a. A 10% increase in the price of a Beetle will reduce the quantity demanded by 20%. b. An increase in consumer income will increase the price and quantity of Beetles sold. Since price elasticity of demand is greater than 1, total revenue will go down.

Weekly leaderboard

Home

Homework Help 3,900,000

Economics 400,000

Recently in Texas, the price of twinkies fell from $.80-$.70, as a result, the quantity demanded of cakes decreased from 120 to 100. What would be the appropriate elasticity to compute using the midpoint method. Compute this elasticity. What does your answer tell you?

Unlock all answers

Related textbook solutions

Principles of Economics

Principles of Macroeconomics

Principles of Microeconomics

Related questions

Weekly leaderboard