Question

The following table shows the demand schedule for a particular good.

Price	Quantity
$20	0
$16	3
$12	6
$8	9
$4	12
$0	15

a) Use the midpoint method, calculate the price elasticity of demand when the price rises from $12 to $16.

b) Which kind of elasticity did you find? (Explain)

c) If price increases from $12 to $16, calculate the total revenue for both price levels. (Show Work)

-d) What happens to the total revenue when price increases?

-e) Is it consistent with the elasticity that you calculated in part (a)? Explain.

Answer 1