If the price elasticity of demand calculated using

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12) If the price elasticity of demand (calculated using the mid-point method) for a good is 2.5, and the price of the good rises from \$18 to \$22, then the quantity demanded will: a) decrease by 8 percent. b) decrease by 25 percent. c) decrease by 50 percent. d) increase by 2.5 percent. Answer: C

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3 Assume that after graduation, you land a marketing job with Canon - in the digital camera division. After introducing a new digital camera, you estimate that the price elasticity of demand for the camera equals 2 and the income elasticity is equal to 0.5. Furthermore, the cross-price elasticity with a similar Kodak camera is equal to 1.25. 13) Based on the above elasticity information, you would conclude for the new Canon camera: 14) Based on the above elasticity information, you would conclude for the new Canon camera that the product is income: 15) During a drought, the price elasticity of demand for water is less than one. During a flood, the price elasticity of demand for water is greater than one. This means that the:
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