Question

Suppose that in a week the price of Greek yogurt decreases from $1.75 to $1.25 per container. At the same time, the quantity of Greek yogurt demanded at a typical grocery store increases from 10,000 to 18,000 containers per month. What is the price elasticity of demand for Greek yogurt

Answer 1

Answer:

1.11

Explanation:

New price = 1.75

Old price = 1.25

Price percentage= 1.75-1.25/1.25

= 0.5/1.25

= 0.4

New quantity = 18,000

Old quantity= 10,000

Quantity percentage, = 18000-10/000/18000

= 8000/18000

= 0.44

Price elasticity= 0.44/0.4

= 1.11

Hence price elasticity is 1.11