Question

1.calculate the price elasticity of demand when the price was increased from R25 to R40 ? (10)
2.is a price increase the correct decision to raise revenue?substantiate your answer using the price elasticity of demand and income elasticity of demand concepts? (30)
3.using examples explain how demand,price elasticity,and total revenue are all related to each other.explain this relationship using at least two examples that incorporates all three concepts? (30)
4.evaluate the various factors that affect the price elasticity of demand?justify your answer (30)

Answer 1

All of them

Answer 2

plants

Answer 3

The answer of number one is 1.25

Answer 4

(Q2-Q1\Q2+Q1)\(P2-P1\P2+P1)

Answer 5

25000-100000÷100000×100=75000÷100000×100=75%.45-25÷25×100=15÷25×100=1500÷25=60%.75÷60=5÷4=1,25

Answer 6

Then number of substitute availabe.the proportion of income that is spent on goods.