Suppose you are a painter, and the price of a gallon of paint increases from $3.00 a

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Suppose you are a painter, and the price of a gallon of paint increases from $3.00 a gallon to $3.50 a gallon. Your usage of paint drops from 35gallons a month to 20gallons a month Perform the following:

1. Compute the price elasticity of demand for paint and show your calculations.

2. Decide whether the demand for paint is elastic , unitary elastic, or inelastic.

3. Explain your reasoning and interpret your results

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An Introduction to Management Science Quantitative Approach to Decision Making

ISBN: 978-1337406529

15th edition

Authors: David R. Anderson, Dennis J. Sweeney, Thomas A. Williams, Jeffrey D. Camm, James J. Cochran

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Question Posted: May 12, 2012 06:09 AM

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Suppose you are a painter, and the price of a gallon of paint increases from $3.00 a

Question:

Step by Step Answer:

1 Computation of the price elasticity of demand Price elasticity of demand 2q1 q0 q1 q0 2p1 p0 p1 p0 ...View the full answer

An Introduction to Management Science Quantitative Approach to Decision Making

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