7. Josh Brinkley is pricing popcorn at the local movie theatre. If the marginal cost of a 16 oz. bag of popcorn is $0.50 and the price elasticity of demand is -1.25, what price should Josh set? a. $0.50 b. $0.75 c. $1.25 d. $2.50

7. Josh Brinkley is pricing popcorn at the local movie theatre. If the marginal cost of a 16 oz. bag of popcorn is $0.50 and the price elasticity of demand is -1.25, what price should Josh set? a. $0.50 b. $0.75 c. $1.25 d. $2.50

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter5: Elasticity

Section: Chapter Questions

Problem 7SCQ: What would the gasoline price elasticity of supply mean to UPS or FedEx?

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Question

7. Josh Brinkley is pricing popcorn at the local movie theatre. If the marginal cost of a 16
oz. bag of popcorn is $0.50 and the price elasticity of demand is -1.25, what price should
Josh set?
a. $0.50
b. $0.75
c. $1.25
d. $2.50

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