If average movie attendance is 250 million when prices are $9 a ticket and 200 million when prices are $11 a ticket, the elasticity of demand for movie tickets is about:
A) 0.0.
B) 0.9.
C) 1.1.
D) 1.8.

Question

Quizplus · Accepted Answer

Elasticity of demand = (% change in quantity demanded) / (% change in price). The quantity demanded changes from 250 million to 200 million, a 20% decrease. The price changes from $9 to $11, a 22.22% increase. Elasticity = 20% / 22.22% = 0.9, which is approximately 1.1.

If Average Movie Attendance Is 250 Million When Prices Are