Question

A shirt manufacturer sold 10 dozen shirts per day when the price was $4 per shirt and sold 10 dozen shirts per day when the price was $3 per shirt. The absolute value of the price elasticity of demand, is:

Answer 1

0

Step-by-step explanation:

Price elasticity of demand measures the responsiveness of quantity demanded to changes in price.

Price elasticity of demand = percentage change in quantity demanded/ percentage change in price.

Percentage change in price = ($4 -$3) / $4 = 0.25 =25%

Percentage change in quantity demanded = ( 10 -10) /10 =0

0 / 25% = 0

This indicates demand Is perfectly inelastic.

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