Question

The consumer demand equation for tissues is given by q = (94 − p)^2, where p is the price per case of tissues and q is the demand in weekly sales. Determine the price elasticity of demand E when the price is set at $34. (Round your answer to three decimal places.)

Answer 1

Price elasticity of demand is 1.133

Step-by-step explanation:

Step-by-step explanation:

Given Data;

q = (94 − p)^2

p = price per case of tissue

q = demand in weekly sales

p = $34

Price elasticity of demand E =?

To calculate the price elasticity of demand, we use the formula;

E =⁻
`(dq)/(dp) * (p)/(q)` ----------------------1

By differentiating q with respect to p, we have

dp/dq = (94 − p)^2

=2( 94-p) * (-1)

= -2(94-p)

Substituting into equation 1,

where dp/dq = -(94-p) and q = (94 − p)^2

E =( -) -2(94-p) * p/((94 − 34)^2)

When the price is at $34, Elasticity becomes

E = -2(94-34) * 34/((94 − 34)^2)

=( 2*60) * (34/60²)

=120 * 34/3600

= 120 * 0.00944

=1.133

Answer 2

So the Determine the price elasticity of demand E is $
`$(17)/(15)`

Step-by-step explanation:

Given that :

q =
`(94-p)^(2)` where p is the price per case of tissues and q is the demand in weekly sales

As we know that price elasticity of demand given as:

`E=-(dq)/(dp).(p)/(q)`

Here we have:
`(dq)/(dp) = -2(91-p)`, substitute into E we have:

`E=2 (94-p)(p)/((94-p)^2).`

when the price is set at $34, we have:

`E=2 (94-34)(34)/((94-34)^2).`

=$
`(17)/(15)`

So the Determine the price elasticity of demand E is $
`$(17)/(15)`