4. In one month, a beef burger restaurant sold 2,500 personal beef burger at $2.50 per pizza. When this restaurant increased its price by 20%, its total revenue for the next month increased to $12,500. As a result of this price increase, however, the monthly sales of chicken meat decreased from 2,500 slices to 2,000 slices. Using the arc elasticity method, a) find the price elasticity of demand for this restaurant's beef burger; and b) find the cross-elasticity of demand for chicken meat with respect to the price of burger. Comment on your result.

4. In one month, a beef burger restaurant sold 2,500 personal beef burger at $2.50 per pizza. When this restaurant increased its price by 20%, its total revenue for the next month increased to $12,500. As a result of this price increase, however, the monthly sales of chicken meat decreased from 2,500 slices to 2,000 slices. Using the arc elasticity method, a) find the price elasticity of demand for this restaurant's beef burger; and b) find the cross-elasticity of demand for chicken meat with respect to the price of burger. Comment on your result.

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter5: Elastic And Its Application

Section: Chapter Questions

Problem 6PA: Suppose that your demand schedule for DVDs is as follows: Price Quantity Demanded (income = 10,000)...

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