Use the graph to the right for Yolanda's Frozen Yogurt Stand to answer the questions that follow. Use the midpoint formula to calculate the price elasticity of demand for D, between point A and point C and the price elasticity of demand for D₂ between point A and point B. Price elasticity of demand for D₁ = (Round your response to two decimal places. Be sure to include the minus sign as needed.) Price elasticity of demand for D₂ = (Round your response to two decimal places. Be sure to include the minus sign as needed.) Which curve is more elastic? Suppose Yolanda is initially selling 100 cones per day at a price of $2.50 per cone. If she changes her price to $1.50 per cone and her demand curve is D,, what will be the change in her revenue? $(Round your response to two decimal places. Be sure to include the minus sign as needed.) What will be the change in her revenue if her demand curve is D₂? (Round your response to two decimal places as needed.) 4.00 3.75- 3.50- 3.25- 3.00- 2.75-P₁ 1 2.50- 225 2.00 1.75 P2 1.50 1.25- 1.00 0.75- 0.50- 0.25- 0.00+ 0.0 125 175 50.0 100.0 150.0 200.0 Quantity (cones per day) 250.0 o o Q

Use the graph to the right for Yolanda's Frozen Yogurt Stand to answer the questions that follow. Use the midpoint formula to calculate the price elasticity of demand for D, between point A and point C and the price elasticity of demand for D₂ between point A and point B. Price elasticity of demand for D₁ = (Round your response to two decimal places. Be sure to include the minus sign as needed.) Price elasticity of demand for D₂ = (Round your response to two decimal places. Be sure to include the minus sign as needed.) Which curve is more elastic? Suppose Yolanda is initially selling 100 cones per day at a price of $2.50 per cone. If she changes her price to $1.50 per cone and her demand curve is D,, what will be the change in her revenue? $(Round your response to two decimal places. Be sure to include the minus sign as needed.) What will be the change in her revenue if her demand curve is D₂? (Round your response to two decimal places as needed.) 4.00 3.75- 3.50- 3.25- 3.00- 2.75-P₁ 1 2.50- 225 2.00 1.75 P2 1.50 1.25- 1.00 0.75- 0.50- 0.25- 0.00+ 0.0 125 175 50.0 100.0 150.0 200.0 Quantity (cones per day) 250.0 o o Q

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter5: Elasticity Of Demand And Supply

Section: Chapter Questions

Problem 1.1P: (Calculating Price Elasticity of Demand) Suppose that 50 units of a good are demanded at a price of...

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