Credit Sprint / Practice problems / Price elasticity of demand (midpoint)
Price elasticity of demand (midpoint) practice problems
Microeconomics Unit 2. Try each one, then open the worked solution. The Credit Sprint app generates unlimited new versions with fresh numbers.
When the price of concert tickets rises from $7 to $10, quantity demanded falls from 150 to 90. Using the midpoint method, what is the price elasticity of demand? (Round to 2 decimals.)
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%ΔQ = -60 ÷ 120 = -50%. %ΔP = 3 ÷ 8.5 = 35.29%. |-50 ÷ 35.29| = 1.42. Elastic.
When the price of concert tickets rises from $6 to $9, quantity demanded falls from 560 to 440. Using the midpoint method, what is the price elasticity of demand? (Round to 2 decimals.)
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%ΔQ = -120 ÷ 500 = -24%. %ΔP = 3 ÷ 7.5 = 40%. |-24 ÷ 40| = 0.6. Inelastic.
When the price of concert tickets rises from $9 to $12, quantity demanded falls from 220 to 180. Using the midpoint method, what is the price elasticity of demand? (Round to 2 decimals.)
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%ΔQ = -40 ÷ 200 = -20%. %ΔP = 3 ÷ 10.5 = 28.57%. |-20 ÷ 28.57| = 0.7. Inelastic.
When the price of concert tickets rises from $5 to $7, quantity demanded falls from 420 to 370. Using the midpoint method, what is the price elasticity of demand? (Round to 2 decimals.)
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%ΔQ = -50 ÷ 395 = -12.66%. %ΔP = 2 ÷ 6 = 33.33%. |-12.66 ÷ 33.33| = 0.38. Inelastic.
When the price of concert tickets rises from $14 to $17, quantity demanded falls from 200 to 170. Using the midpoint method, what is the price elasticity of demand? (Round to 2 decimals.)
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%ΔQ = -30 ÷ 185 = -16.22%. %ΔP = 3 ÷ 15.5 = 19.35%. |-16.22 ÷ 19.35| = 0.84. Inelastic.
When the price of concert tickets rises from $15 to $18, quantity demanded falls from 180 to 140. Using the midpoint method, what is the price elasticity of demand? (Round to 2 decimals.)
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%ΔQ = -40 ÷ 160 = -25%. %ΔP = 3 ÷ 16.5 = 18.18%. |-25 ÷ 18.18| = 1.38. Elastic.