Calculate the price elasticity of demand. a) When the price of a phone call increases from...

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Calculate the price elasticity of demand. a) When the price of a phone call increases from $8 to $12, the volume of calls falls from 25,000 per hour to 15,000. b) New car dealers currently sell approximately 1,650 vehicles annually at an average price of $4 million. They have told the government that if the proposed higher import duty raises the price of new cars by $% million, they expect their sales to fall by about 300 per year. Calculate the price elasticity of demand. a) When the price of a phone call increases from $8 to $12, the volume of calls falls from 25,000 per hour to 15,000. b) New car dealers currently sell approximately 1,650 vehicles annually at an average price of $4 million. They have told the government that if the proposed higher import duty raises the price of new cars by $% million, they expect their sales to fall by about 300 per year.

Answer rating: 100% (QA)

CASE A Price elasticity of demand CHANGE IN QUANTITY DEMAND CHANGE IN PRICE Price increased 8 ... View the full answer