There are many businesses selling flowers in Brisbane on any given day. A flower shop sells a basic bouquet for $24.99 and sells, on average, 10 bouquets per day. The flower shop decides to decrease the price of the basic bouquet to $20.99 and sells 18 bouquets that day. Which of the following statements are true (to four decimal places): The point price elasticity of demand for the basic bouquet of flowers at a price of $24.99 is 4.9980. The point price elasticity of demand for the basic bouquet of flowers at a price of $24.99 is 1.2495. ⒸA 1% increase in the price of a basic bouquet would lead to a 1.2495% decrease in the quantity of basic bouquets demanded. A 1% decrease in the price of a basic bouquet would lead to a 1.2495% increase in the quantity of basic bouquets demanded.
There are many businesses selling flowers in Brisbane on any given day. A flower shop sells a basic bouquet for $24.99 and sells, on average, 10 bouquets per day. The flower shop decides to decrease the price of the basic bouquet to $20.99 and sells 18 bouquets that day. Which of the following statements are true (to four decimal places): The point price elasticity of demand for the basic bouquet of flowers at a price of $24.99 is 4.9980. The point price elasticity of demand for the basic bouquet of flowers at a price of $24.99 is 1.2495. ⒸA 1% increase in the price of a basic bouquet would lead to a 1.2495% decrease in the quantity of basic bouquets demanded. A 1% decrease in the price of a basic bouquet would lead to a 1.2495% increase in the quantity of basic bouquets demanded.
Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter20: Consumer Choice And Elasticity
Section: Chapter Questions
Problem 13CQ: Suppose Erin, the owner-manager of a local hotel projects the following demand for her rooms: a....
Related questions
Question
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Economics: Private and Public Choice (MindTap Cou…
Economics
ISBN:
9781305506725
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning
Microeconomics: Private and Public Choice (MindTa…
Economics
ISBN:
9781305506893
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning
Economics: Private and Public Choice (MindTap Cou…
Economics
ISBN:
9781305506725
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning
Microeconomics: Private and Public Choice (MindTa…
Economics
ISBN:
9781305506893
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning