Question

Your local grocery store offers a coupon that reduces the price of milk during the coming week. The regular retail price of milk in the store is $3.00 per gallon, and the coupon price is $2.00 per gallon for the next week. If the store maximizes profits and the price elasticity of demand for milk is -2 for coupon users, what is the price elasticity of demand for non-users?

Answer 1

We do not have enough information to answer this question.

Step-by-step explanation:

The price elasticity of demand measure the elasticity of anything when there is a change in the quantity demanded of that thing relative to the percentage change in price of it.

The formula for Price elasticity of demand is,

=> Percentage change in QTY demanded / Percentage change in price.

Hence it can be concluded that although we have the change in price but we do not have the quantity mentioned in the question anywhere.

Hope this helps.

Thankyou.