The price elasticity of demand of colour TVs is estimated to be -2.5. If the price of colour TVs are reduced by 20 percent, how much percentage increase in the quantity of colour TVs sold do you expect?
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9
Answer:
50 percentage increase in the quantity of colour TVs
Explanation:
Ep = Percentage change in quantity demanded /Percentage change in price
2.5 = Percentage change in quantity demanded/ 20
Percentage change in quantity demanded = 20 * 2.5
Percentage change in quantity demanded = 50
Answered by
1
Answer:
50% increase
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