Homework answers / question archive / 1)     Suppose that your demand schedule for pizza is as follows:   Price     Qty Demanded (income = $20,000)               Qty Demanded (income = $24,000) $8                           40 pizzas                                                                 50 pizzas 10                            32                                                                             45 12                             24                                                                             30 14                             16                                                                              20 16                              8                                                                               12 a

1)     Suppose that your demand schedule for pizza is as follows:   Price     Qty Demanded (income = $20,000)               Qty Demanded (income = $24,000) $8                           40 pizzas                                                                 50 pizzas 10                            32                                                                             45 12                             24                                                                             30 14                             16                                                                              20 16                              8                                                                               12 a

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1)     Suppose that your demand schedule for pizza is as follows:

Price     Qty Demanded (income = $20,000)               Qty Demanded (income = $24,000)

$8                           40 pizzas                                                                 50 pizzas

10                            32                                                                             45

12                             24                                                                             30

14                             16                                                                              20

16                              8                                                                               12

a. Use the midpoint method to calculate your price elasticity of demand as the price of pizza increases from $8 to $10 if (i) your income is $20,000 and (ii) your income is $24,000.

b.      Calculate your income elasticity of demand as your income increases from $20,000 to $24,000 if (i) the price is $12 and (ii) the price is $16.