A bakery works out a demand function for its chocolate chip cookies and finds it to be q = D(x) 895-11x, where q is the quantity of cookies sold when the price per cookie, in cents, is x. Use this information to answer parts a) through f). a) Find the elasticity. E(x)= b) At what price is the elasticity of demand equal to 1? (Round to the nearest cent as needed.) c) At what prices is the elasticity of demand elastic? OA. Greater than 41c OB. Less than 41c OC. Prices are elastic at all values. OD. Prices cannot be elastic in this case d) At what prices is the elasticity of demand inelastic? OA. Prices cannot be inelastic in this case OB. Less than 41e OC. Greater than 41 OD. Prices are inelastic al all values e) At what price is the revenue a maximum? x= 0- (Round to the nearest cent as needed. Use a comma to separate answers as needed.) At a price of 17¢ per cookie, will a small increase in price cause the total revenue to increase or decrease? Decrease O Increase
A bakery works out a demand function for its chocolate chip cookies and finds it to be q = D(x) 895-11x, where q is the quantity of cookies sold when the price per cookie, in cents, is x. Use this information to answer parts a) through f). a) Find the elasticity. E(x)= b) At what price is the elasticity of demand equal to 1? (Round to the nearest cent as needed.) c) At what prices is the elasticity of demand elastic? OA. Greater than 41c OB. Less than 41c OC. Prices are elastic at all values. OD. Prices cannot be elastic in this case d) At what prices is the elasticity of demand inelastic? OA. Prices cannot be inelastic in this case OB. Less than 41e OC. Greater than 41 OD. Prices are inelastic al all values e) At what price is the revenue a maximum? x= 0- (Round to the nearest cent as needed. Use a comma to separate answers as needed.) At a price of 17¢ per cookie, will a small increase in price cause the total revenue to increase or decrease? Decrease O Increase
Chapter5: Elasticity Of Demand And Supply
Section: Chapter Questions
Problem 1.1P: (Calculating Price Elasticity of Demand) Suppose that 50 units of a good are demanded at a price of...
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Transcribed Image Text:A bakery works out a demand function for its chocolate chip cookies and finds it to be q = D(x) 895-11x, where q is the
quantity of cookies sold when the price per cookie, in cents, is x. Use this information to answer parts a) through f).
a) Find the elasticity.
E(x)=
b) At what price is the elasticity of demand equal to 1?
(Round to the nearest cent as needed.)
c) At what prices is the elasticity of demand elastic?
OA. Greater than 41c
OB. Less than 41c
OC. Prices are elastic at all values.
OD. Prices cannot be elastic in this case
d) At what prices is the elasticity of demand inelastic?
OA. Prices cannot be inelastic in this case
OB. Less than 41e
OC. Greater than 41
OD. Prices are inelastic al all values
e) At what price is the revenue a maximum?
x=
0-
(Round to the nearest cent as needed. Use a comma to separate answers as needed.)
At a price of 17¢ per cookie, will a small increase in price cause the total revenue to increase or decrease?
Decrease
O Increase
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