The demand function for a certain make of ink-jet cartridge is the following where p is the unit...

Question:

The demand function for a certain make of ink-jet cartridge is the following where p is the unit price in dollars and x is the quantity demanded each week, measured in units of a thousand. Compute the elasticity of demand when x = 6.

$$p(x) = - 0.04 x^2 - 0.5x + 7 $$

The Price Elasticity of Demand:

The price elasticity of demand is a measure of how sensitive the consumers are to a unit change in the price. It gives the percentage change in the quantity the consumers demand when the price is adjusted by one percent.

Answer and Explanation: 1

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We calculate the price elasticity as:

$$\begin{align} \varepsilon= \dfrac{d x}{d p}\times \dfrac{p}{x} \end{align} $$

The demand curve is given...

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Price Elasticity of Demand: Definition, Formula & Example

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Chapter 3 / Lesson 54
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Learn what price elasticity is. Discover how to find price elasticity of demand, study examples of price elasticity, and examine a price elasticity graph.


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