Microeconomics – discussion 3 (inlcuding 2 replies to classmates)

Topic:

For this discussion topic, you will need to reference your textbook.  Remember, you can access the textbook through MindTap.

In section 5-1c of your textbook, “The Midpoint Method,” it calculates the price elasticity of demand from Point A to Point B to be 1.5 when using the percentage change method.  When it uses the midpoint method, price elasticity of demand is 1.

1. Using the same quantities as the textbook for points A and B, suppose the price at point A is now \$10 and the price at point B is now \$12.  Using the midpoint method, calculate the price elasticity of demand using these new points.  Show your work.
2. Based on the price elasticity you calculated, is it elastic, inelastic, or unit elastic?  Justify your answer.  (For example, price elasticity is 1.5 > 1, so it is elastic).

Directions:

1. You must make a post before viewing the posts of your classmates.  So, your initial post must contain the substantial content for which you would like to receive a grade.  If your initial post is blank or does not contain your full answer, you will not receive full points.
2. You must also reply to two other posts before the due date.
3. You should write approximately 6 sentences and about 250 words. Please check your work for spelling and grammar errors to avoid a loss of points.
4. Writing assignments are based on the 10 point rubric explained in the syllabus.
5. As stated in the syllabus, academic honesty is imperative.  Any incidence of plagiarism will receive a score of zero.  This includes, but is not limited to, any part of your answer being found to be cut and pasted off the internet (including sites like Coursehero and Chegg), or if you change every other word by using synonyms.
6. If your response doesn’t match the questions, then you will receive a score of zero.