You own a hot dog stand that you set up outside the student union every day at lunch time. Currently, you are selling hot dogs for a price of $3, and you sell 30 hot dogs a day (point A on the diagram). You are considering cutting the price to $2. The graph shows two possible increases in the quantity sold as a result of your price cut. Use the information in the graph (new quantities are given on the horizontal axis) to calculate the price elasticity between these two prices on each of the demand curves. Use the midpoint formula to calculate the price elasticities. On the demand curve containing the points "A" and "B", the price elasticity of demand for a price cut from $3 to $2 is -0.25. (Hint: Include the negative sign and enter your response rounded to two decimal places.) סי Price (dollars per hot dog) 30 37 C D₁ Quantity (hot dogs per day) 71 B D 4 De 3

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