The short run price elasticity for electricity consumption is -0.20. If the current price of electricity in central Ohio is $0.10 per Kilowatt hour (delivered to your home), and the typical homeowner uses 900 Kilowatt hours per month, what will happen to consumption of electricity for the typical homeowner if price falls by $0.02 per Kilowatt hour?
The short run price elasticity for electricity consumption is -0.20. If the current price of electricity in central Ohio is $0.10 per Kilowatt hour (delivered to your home), and the typical homeowner uses 900 Kilowatt hours per month, what will happen to consumption of electricity for the typical homeowner if price falls by $0.02 per Kilowatt hour?
Chapter5: Price Elasticity Of Demand And Supply
Section: Chapter Questions
Problem 3SQP
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The short run price elasticity for electricity consumption is -0.20. If the current price of electricity in central Ohio is $0.10 per Kilowatt hour (delivered to your home), and the typical homeowner uses 900 Kilowatt hours per month, what will happen to consumption of electricity for the typical homeowner if price falls by $0.02 per Kilowatt hour?
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