Figure 5-5
-Refer to Figure 5-5.Using the midpoint method,demand is unit elastic between prices of
A)$20 and $40.
B)$40 and $50.
C)$40 and $60.
D)$50 and $70.

Question

Figure 5-5 
-Refer to Figure 5-5.Using the midpoint method,demand is unit elastic between prices of
A)$20 and $40. 
B)$40 and $50. 
C)$40 and $60. 
D)$50 and $70.

Quizplus · Accepted Answer

The midpoint method calculates the elasticity of demand as the percentage change in quantity demanded divided by the percentage change in price. If we draw a line between the two price and quantity points where the elasticity crosses zero, we can see that the midpoint between these points is around $50 and $60. Therefore, demand is unit elastic between prices of $40 and $60.

Figure 5-5 -Refer to Figure 5-5.Using the Midpoint Method,demand Is Unit Elastic