From the following table, calculate the price elasticity and income elasticity of demand.
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ChatGPT
Nov 10
To calculate the price elasticity of demand, we use the formula:
Price Elasticity of Demand = (% Change in Quantity Demanded) / (% Change in Price)
For the first row: Price Elasticity of Demand = (200 - 100) / (2 - 1) = 100 / 1 = 100
For the second row: Price Elasticity of Demand = (150 - 100) / (3 - 2) = 50 / 1 = 50
To calculate the income elasticity of demand, we use the formula:
Income Elasticity of Demand = (% Change in Quantity Demanded) / (% Change in Income)
For the first row: Income Elasticity of Demand = (200 - 100) / (5000 - 4000) = 100 / 1000 = 0.1
For the second row: Income Elasticity of Demand = (150 - 100) / (6000 - 5000) = 50 / 1000 = 0.05
Therefore, the price elasticity of demand for the first row is 100 and for the second row is 50. The income elasticity of demand for the first row is 0.1 and for the second row is 0.05.
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Google Gemini AI
Nov 10
The table you provided does not contain any information on price or income, so I cannot calculate the price elasticity or income elasticity of demand from the provided context.