Question

Jill’s Sausage Dog Stand projects the following demand for Jill’s sausage dogs:

Prices - 2, 4, 6

Quantity Purchased (per day) - 50, 40, 20

a. Calculate the price elasticity of demand between $2 and $4. Is demand in this range elastic or inelastic?

b. Calculate the price elasticity of demand between $4 and $6. Is demand in this range elastic or inelastic?

I’m not sure how to calculate the price elasticity, then determine which is elastic or inelastic.

Answer 1