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Given the Demand Function QX = 1500 - 100PX

Question 24

Multiple Choice

Given the demand function QX = 1500 - 100PX + 75PY + 1.5I + .06A where PY = $40.00. I = $2500, and A = $5,000. When price of good X is increased from $60.00 to $75.00, what is the arc price elasticity of demand for good X over this range?


A) 7.05
B) -7.05
C) 9.08
D) -9.08
E) none of the above

Correct Answer:

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