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Author Question: Compute the elasticity of demand for the demand curve p = 15Q-0.7. Does the elasticity vary with the ... (Read 52 times)

daltonest1984

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on: Jul 1, 2018
Compute the elasticity of demand for the demand curve p = 15Q-0.7. Does the elasticity vary with the price?
 
  What will be an ideal response?

Question 2

Joe's budget constraint equals 500 = 2F + 100S, where 500 is Joe's income, 2 is the price of food (F, y-axis) and 100 is the price of shelter (S, x-axis). How much food can Joe buy if he buys one unit of shelter?
 
  A) 2 units
  B) 200 units
  C) 250 units
  D) 400 units


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JYan

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Reply #1 on: Jul 1, 2018
Answer to Question 1

For constant elasticity demand as this, the elasticity is the same throughout the demand curve. E = -0.7

Answer to Question 2

B


daltonest1984

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Reply 2 on: Jul 1, 2018
YES! Correct, THANKS for helping me on my review

peter

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

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