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GarryVolchara [31]
3 years ago
14

Suppose that 50 hot dogs are demanded at a particular price. If the price of hot dogs rises from that price by 5 percent, the nu

mber of hot dogs demanded falls to 48. Using the midpoint approach to calculate the price elasticity of demand, it follows that the
A) demand for hot dogs in this price range is unit elastic
B) price increase will decrease the total revenue of hot dog sellers.
C) price elasticity of demand for hot dogs in this price range is about 1.22
D) price elasticity of demand for hot dogs in this price range is about 0.82
Business
1 answer:
Drupady [299]3 years ago
4 0

Answer:

The correct answer is option D.

Explanation:

The price elasticity of demand is measure to find out the change in quantity demanded of a commodity due to change in its price.

Midpoint elasticity is used to measure the elasticity between two points on the same demand curve. It divides the percentage change in price and quantity by their average value or midpoint.

% change in Quantity

=\frac{(48-50)}{((48+50)/2)}

= -0.04081

% change in Price

= \frac{(10.5-10)}{((10.5+10)/2)}

= 0.04878

Price elasticity of demand

= \frac {0.0408}{0.0487}

= 0.83

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3 years ago
A corporate bond with a 6% coupon (paid semiannually) has a yield to maturity of 7.5%. The bond matures in 20 years but is calla
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Answer:

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Explanation:

The computation of the yield to call is shown below:

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All star Exposure

Monthly income Statement

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---------------------

(295,000)

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Answer:

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