question archive Suppose there is an increase for the price of pizza sold in the cafeteria form $3 to $4 and the quantity demanded changes from 18 to 16 pizzas
Suppose there is an increase for the price of pizza sold in the cafeteria form $3 to $4 and the quantity demanded changes from 18 to 16 pizzas
Subject:EconomicsPrice:2.88 Bought3
Suppose there is an increase for the price of pizza sold in the cafeteria form $3 to $4 and the quantity demanded changes from 18 to 16 pizzas.
a. What is the price elasticity of demand (demand value) using the midpoints formula?
b. Is this price elasticity: elastic, inelastic or unit elastic?
c. What would happen to the price elasticity of demand for pizza if two or more different restaurants on campus started selling pizza? Will it increase or decrease? Why?
d. What happens to the cafeteria's total revenue in response to this price change? Will it increase or decrease? Calculate that amount.
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