Question

the demand curve for a product is given by p= 120 - 10q. Find the elasticity of demand E when p= 70. If this price rises by 3 percent calculate the corresponding percentage change in demand

Answer 1

Want dq/q, the elasticity, for given dp/p

q = 12-p/10

dq=dp/10

when p = 70,
q = 12-70/10 = 12-7 = 5

dp = .03(70) = 2.1

dq = 0.21

dq/q = 0.21/5 = .042 or 4.2%

Answer 2

thank you

Answer 3

You are very welcome.

Answer 4

how would I solve for elasticity? because the question also wants to know what E is equal to