Answer:
Price elasticity of demand is 0.47
Explanation:
Price elasticity of demand = % change in quantity demanded / %change in price
Price elasticity of demand = Q2-Q1/(Q2+Q1/2) / P2-P1/(P2+P1/2)
P1= $80, Q1 = 20, P2 = $100, Q2 = 18
Price elasticity of demand = (18 - 20) / (18+20/2) / (100-80)/(100+80/2)
Price elasticity of demand = (-2/19) / (20/90)
Price elasticity of demand = -2/19 * 9/2
Price elasticity of demand = -18/38
Price elasticity of demand = -0.47
Thus, Price elasticity of demand is 0.47