If marginal revenue is $20 when the price of a product is $40, then the price elasticity of demand is
A) -2.
B) -1.
C) -0.50.
D) -0.25.

Name: If marginal revenue is $20 when the price of a product is $40, then the price elasticity of demand is A) -2. B) -1. C) -0.50. D) -0.25.
Brand: Quizplus
Rating: 4.7 (35 reviews)

Question

Quizplus · Accepted Answer

The price elasticity of demand (PED) can be calculated using the formula: PED = (P/MR) - 1. Given P = $40 and MR = $20, PED = (40/20) - 1 = 2 - 1 = 1. Since elasticity is negative for demand, the correct answer is -2.

If Marginal Revenue Is $20 When the Price of a Product