Question

Sandy's Sandwich Sitdown
priced its lunch treats

at ​$2.00
​,
they sold 250

per day
.
When the price was ​$3.00
​,
they sold 200

per day
.
Based on this information and using the​ average-values formula, the absolute value of the price elasticity of demand for lunch treats

is
Part 2
A.2.50
2.50
B.0.56
0.56
C.1.79
1.79
D.0.40
0.40

Answer 1

NO, the answer is .56

Answer 2

the correct answer is .56 not .40 but how do I get .56?

Answer 3

To calculate the price elasticity of demand, we can use the formula:

Price Elasticity of Demand = (Percentage Change in Quantity Demanded) / (Percentage Change in Price)

First, let's calculate the percentage change in quantity demanded:
Percentage Change in Quantity Demanded = ((New Quantity Demanded - Old Quantity Demanded) / Old Quantity Demanded) * 100

Percentage Change in Quantity Demanded = ((200 - 250) / 250) * 100 = (-50 / 250) * 100 = -20%

Next, let's calculate the percentage change in price:
Percentage Change in Price = ((New Price - Old Price) / Old Price) * 100

Percentage Change in Price = ((3.00 - 2.00) / 2.00) * 100 = (1.00 / 2.00) * 100 = 50%

Now we can plug these values into the formula to find the price elasticity of demand:
Price Elasticity of Demand = (-20% / 50%)

Price Elasticity of Demand = -0.4

The absolute value of the price elasticity of demand is 0.4.

Answer: D. 0.40

Answer 4

Apologies for the incorrect response. Let's recalculate the price elasticity of demand using the correct formula:

Price Elasticity of Demand = (Percentage Change in Quantity Demanded) / (Percentage Change in Price)

Percentage Change in Quantity Demanded = ((New Quantity Demanded - Old Quantity Demanded) / Old Quantity Demanded) * 100
Percentage Change in Quantity Demanded = ((200 - 250) / 250) * 100
Percentage Change in Quantity Demanded = (-50 / 250) * 100
Percentage Change in Quantity Demanded = -20%

Percentage Change in Price = ((New Price - Old Price) / Old Price) * 100
Percentage Change in Price = ((3.00 - 2.00) / 2.00) * 100
Percentage Change in Price = (1.00 / 2.00) * 100
Percentage Change in Price = 50%

Price Elasticity of Demand = (-20% / 50%)
Price Elasticity of Demand = -0.4

To obtain the absolute value, we ignore the negative sign:
Absolute Value of Price Elasticity of Demand = |-0.4|
Absolute Value of Price Elasticity of Demand = 0.4

Therefore, the correct answer is D. 0.40.

Answer 5

Apologies for the confusion. To calculate the price elasticity of demand, we use the formula:

Price Elasticity of Demand = (Percentage Change in Quantity Demanded) / (Percentage Change in Price)

Percentage Change in Quantity Demanded = ((New Quantity Demanded - Old Quantity Demanded) / Old Quantity Demanded) * 100
Percentage Change in Quantity Demanded = ((200 - 250) / 250) * 100
Percentage Change in Quantity Demanded = (-50 / 250) * 100
Percentage Change in Quantity Demanded = -20%

Percentage Change in Price = ((New Price - Old Price) / Old Price) * 100
Percentage Change in Price = ((3.00 - 2.00) / 2.00) * 100
Percentage Change in Price = (1.00 / 2.00) * 100
Percentage Change in Price = 50%

Price Elasticity of Demand = (-20% / 50%)
Price Elasticity of Demand = -0.4

To obtain the absolute value, we ignore the negative sign:
Absolute Value of Price Elasticity of Demand = |-0.4|
Absolute Value of Price Elasticity of Demand = 0.4

Again, I apologize for the incorrect calculation in my previous response. The correct answer is indeed D. 0.40.