Question: 2. The Sugar Plum Inn had an average dinner cover charge of $8.75 during the month of June, when 3,000 patrons were served. E.L.

2. The Sugar Plum Inn had an average dinner cover charge of

2. The Sugar Plum Inn had an average dinner cover charge of $8.75 during the month of June, when 3,000 patrons were served. E.L. Plum, the owner/manager, increased the dinner menu prices by an average of $.50 per item. During the first 30 days of July, the average cover charge was $9.25 for the 2,900 patrons who were served dinner. Q1: Compute the price elasticity of demand. Q2: How is demand characterized based on your calculations?

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