5.) The deamnd for rosebushes in a market is as follows Price (Per rosebush)-- $

Question

5.) The deamnd for rosebushes in a market is as follows

Price (Per rosebush)-- $10, $11, $12, $13
Quanity Demanded (rosebushes per week)-- 230, 150, 90, 40

a.) Calculate the price elasticity of demand for roses for a price increase from $10 to $11. Is demand elastic or inelastic for this price change?

b.) Calculate the price elasticity of demand for roses for a price increase from $12 to $13. Is demand elastic of inelastic for this price change?

Explanation / Answer

a) change of price = 12 - 11 = 1 ($) change of demand = 150 - 230 = -80 price of elasticity of demand = change of demand/change of price => = -80/1 => = -80 b) change of price = 13 - 12 = 1 ($) change of demand = 40 - 90 = -50 price of elasticity of demand = change of demand/change of price => = -50/1 => = -50

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