You are given market data that says that when the price of pizza is $3, the quantity demanded of pizza is 40 slices and the quantity demanded of cheese bread is 90 pieces. When the price of pizza is $1, the quantity demanded of pizza is 60 slices and the quantity demanded of cheese bread is 60 pieces.

1. Can the price elasticity of demand (PED) be calculated for either good?

2. If so, calculate the PED.

3. Can the cross price elasticity of demand (CPED) be calculated for the two goods?

4. If yes, calculate the CPED.

Answer rating: 100% (QA)

To calculate the price elasticity of demand PED we use the formula PED frac text change in quantity ... View the full answer