Question: Table 19-2 on page 424 indicates that the short-run price elasticity of demand for tires is 0.9. If an increase in the price of petroleum

Table 19-2 on page 424 indicates that the short-run price elasticity of demand for tires is 0.9. If an increase in the price of petroleum (used in producing tires) causes the market prices of tires to rise from $50 to $60, by what percentage would you expect the quantity of tires demanded to change?

Estimated Elasticity Category Short Run Long Run 1.2 2.7 N.A. N.A Air travel (business) Air travel (vacation) 0.4 Electricity Fresh tomatoes Gasoline Hospital services Intercity bus service Physician services Private education Restaurant meals Tires 0.6 0.3 0.1 4.6 0.2 0.1 0.6 N.A. 0.5 0.7 2.2 0.6 9 2.3 0.9 N.A. 1.2

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