The data below represent a demand schedule.
Price / demand
6 0
5 1
4 2
3 3
2 4
1 5
0 6
a. Draw a demand curve.
b. Use the midpoint formula for Ed to determine price elasticity of demand for each of the four possible $1 price changes.
Moving from $5 to $4: Ed = .
Moving from $4 to $3: Ed = .
Moving from $3 to $2: Ed = .
Moving from $2 to $1: Ed = .
c. What can you conclude about the relationship between the slope of the demand curve above and its elasticity?
The demand curve above has a constant slope of (-1∞10), but elasticity (increases/decreases) as we move down the curve.
d. Explain in a nontechnical way why demand is elastic in the upper-left segment of the demand curve and inelastic in the lower-right segment.
The data below represent a demand schedule.
Price / demand
6 0
5 1
4 2
3 3
2 4
1 5
0 6
a. Draw a demand curve.
b. Use the midpoint formula for Ed to determine price elasticity of demand for each of the four possible $1 price changes.
Moving from $5 to $4: Ed = .
Moving from $4 to $3: Ed = .
Moving from $3 to $2: Ed = .
Moving from $2 to $1: Ed = .
c. What can you conclude about the relationship between the slope of the demand curve above and its elasticity?
The demand curve above has a constant slope of (-1∞10), but elasticity (increases/decreases) as we move down the curve.
d. Explain in a nontechnical way why demand is elastic in the upper-left segment of the demand curve and inelastic in the lower-right segment.
Related textbook solutions
Related questions
Use the following demand schedule for a monopolist to calculate total revenue and marginal revenue. For each price, indicate whether demand is elastic, unit elastic, or inelastic.
| price (P)($) | Quantity demanded (Q) | Total Revenue | Marginal Revenue | Price Elasticity of demand (Ed) |
| 5.00 | 0 | |||
| 4.50 | 1 | |||
| 4.00 | 2 | |||
| 3.50 | 3 | |||
| 3.00 | 4 | |||
| 2.50 | 5 | |||
| 2.00 | 6 | |||
| 1.50 | 7 | |||
| 1.00 | 8 | |||
| 0.50 | 9 | |||
| 0.00 | 10 |
Use the following demand schedule for a monopolist to calculate total revenue and marginal revenue. For each price, indicate whether demand is elastic, unit elastic, or inelastic.
| Price (P)($) | Quantity demanded (Q) | Total Revenue | Marginal Revenue | Price Elasticity of demand (Ed) |
| 5.00 | 0 | |||
| 4.50 | 1 | |||
| 4.00 | 2 | |||
| 3.50 | 3 | |||
| 3.00 | 4 | |||
| 2.50 | 5 | |||
| 2.00 | 6 | |||
| 1.50 | 7 | |||
| 1.00 | 8 | |||
| 0.50 | 9 | |||
| 0.00 | 10 |