When the price of corn dogs is $1.00, 5,000 corn dogs are demanded. When the price of corn dogs is $2.00, 2,500 are demanded. What is the price elasticity of demand for corn dogs?

Answer 1

% Change = (2500-5000) / 5000 = -0.50
Expressed as a decimal.

% Change in P. = (2-1) / 1 = 1.00
Expressed as a decimal.

PED = -0.50 / 1 = -0.50.