The table below shows the demand schedule for museum admissions in a small city. $\begin{array}{|c|c|}
\hline \begin{array}{c}
\text { Price } \
\text { (per visit } \
\text { per person) }\
\end{array} & \begin{array}{c}
\text { QuantityDemanded } \
\text { (thousands of }\\text { person-visits per year) }
\end{array} \
\hline \$ 10 & 2 \
\hline \$ 8 & 4 \
\hline \$ 6 & 6 \
\hline \$ 4 & 8 \
\hline \$ 2 & 10 \
\hline
\end{array}$ TABLE 4- 1
-Refer to Table 4- 1. Between the prices of $8 and $10, the elasticity of demand is
A) 1/3.
B) 3.
C) 2.
D) 2/3.
E) 1.

Question

Quizplus · Accepted Answer

The elasticity of demand is calculated using the formula: $(\% \text{ change in quantity demanded}) / (\% \text{ change in price})$. Between $8 and $10, the quantity demanded changes from 4 to 2 (a 50% decrease), and the price changes from $8 to $10 (a 25% increase). Thus, the elasticity is $50\% / 25\% = 2$.

The Table Below Shows the Demand Schedule for Museum Admissions