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Use the Following Data for a Demand Curve ×\times Quantity Maximized? What Is the Elasticity at That Point

Question 58

Essay

Use the following data for a demand curve. Use the following data for a demand curve. (A)Use the midpoint formula to calculate the elasticity between a price of $14 and $15. (B)Use the midpoint formula to calculate the elasticity between $7 and $8. (C)Because this is a linear demand curve, why does the elasticity change? (D)At what point is price \times quantity maximized? What is the elasticity at that point?
(A)Use the midpoint formula to calculate the elasticity between a price of $14 and $15.
(B)Use the midpoint formula to calculate the elasticity between $7 and $8.
(C)Because this is a linear demand curve, why does the elasticity change?
(D)At what point is price ×\times quantity maximized? What is the elasticity at that point?

Correct Answer:

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(A)Elasticity between $14 and $15: 9.67
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