Question: Suppose you are given the following data on demand for a product. Price 10, 9, 8, 7, 6 Quantity Demanded 30, 40, 50, 60, 70

Suppose you are given the following data on demand for a product.

Price 10, 9, 8, 7, 6

Quantity Demanded 30, 40, 50, 60, 70

a)

Calculate the value of price elasticit

y of demand at

the

price equal to $8

?

b)

Is the demand elastic or in

elastic at the price equal to $8

? ANSWER: _____

____________

___

c)

Interpret the value of price elasticity of demand calculated in part (a)?

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