You are an economist. Your friend started a new business selling masks. She asked for your help in making some important decisions. From the data obtained from her, you computed the Price Elasticity of Demand (PED) of Masks, and found absolute PED in February was 1.26, and since then the absolute PED of Masks declined by 30% in June. (a) Based on the PED of June, you would advise your friend for an increase/decrease/unchanged in the price - nsert one word answer (increase/decrease/unchanged) (b) The market price of the mask in July was Tk15 per unit. The total revenue earned in July was Tk300. You received the data for August and observed that the price now in August is Tk26 per unit and the quantity of masks sold in August is 9 units. Calculate the absolute value of Price Elasticity of Demand (PED) for masks from July to August. Do not convert into percentage. Give your answer in 2 decimal places. Eg. If you get PED = -0.253 then submit 0.25

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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You are an economist. Your friend started a new business selling masks. She asked for your help in making some important decisions. From the data
obtained from her, you computed the Price Elasticity of Demand (PED) of Masks, and found absolute PED in February was 1.26, and since then the
absolute PED of Masks declined by 30% in June.
(a) Based on the PED of June, you would advise your friend for an increase/decrease/unchanged in the price -
Insert one word answer (increase/decrease/unchanged)
(b) The market price of the mask in July was Tk15 per unit. The total revenue earned in July was Tk300. You received the data for August and observed
that the price now in August is Tk26 per unit and the quantity of masks sold in August is 9 units.
Calculate the absolute value of Price Elasticity of Demand (PED) for masks from July to August.
Do not convert into percentage. Give your answer in 2 decimal places. Eg. If you get PED = -0.253 then submit 0.25
Transcribed Image Text:You are an economist. Your friend started a new business selling masks. She asked for your help in making some important decisions. From the data obtained from her, you computed the Price Elasticity of Demand (PED) of Masks, and found absolute PED in February was 1.26, and since then the absolute PED of Masks declined by 30% in June. (a) Based on the PED of June, you would advise your friend for an increase/decrease/unchanged in the price - Insert one word answer (increase/decrease/unchanged) (b) The market price of the mask in July was Tk15 per unit. The total revenue earned in July was Tk300. You received the data for August and observed that the price now in August is Tk26 per unit and the quantity of masks sold in August is 9 units. Calculate the absolute value of Price Elasticity of Demand (PED) for masks from July to August. Do not convert into percentage. Give your answer in 2 decimal places. Eg. If you get PED = -0.253 then submit 0.25
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