Question

If the price elasticity of demand for a product is -2.5, then a price cut from $2.00 to $1.80 will _________ the quantity demanded by about ________.

Answer 1

If the price elasticity of demand for a product is -2.5, then a price cut from $2.00 to $1.80 will increase the quantity demanded by about  2.5%.

Price elasticity of call for is a measurement of the trade in the intake of a product on the subject of exchange in its price. Expressed mathematically, it's miles: charge Elasticity of demand = percent trade-in quantity Demanded / percentage trade-in rate.

we are saying a great is price elastic whilst growth in prices causes a bigger % fall in demand. e.g. if fee rises 20% and demand falls 50%, the PED = -2.five. Examples consist of Heinz soup.

Learn more about Price elasticity here: brainly.com/question/24384825

#SPJ4