Question

a consumer buys 100 units of good rupees 5 per unit the price elasticity of demand for the good is -2 at what price will he be willing to buy 140 units of good x

Answer 1

Answer:

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Explanation:

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Answer 2

Answer:

Original Quantity (Q) = 100 units Original Price (P) = Rs. 5New Quantity

(Q1)=140 units New Price (P1)=?Change in Quantity (ΔQ)=40 units Change in

Price (ΔP)=? Elasticity of Demand (ED) = 2

Price Elasticity of demand (ED)=ΔQΔP×PQ

2=40ΔP×5100=ΔP=Rs.1

$As the quantity demanded is increasing, price will decrease. It means that$

$New Price = Original Price (P) - Change in Price (ΔP)=5−1=Rs.4$

$New Price = Rs. 4$