If the demand function for a particular good is Q = 50 − 4P,then demand at a price of $10 is:
A) elastic.
B) unit elastic.
C) inelastic.
D) Elasticity cannot be determined.

Question

Quizplus · Accepted Answer

The elasticity of demand can be calculated using the formula: E = (dQ/dP) * (P/Q). At P = $10, Q = 50 - 4(10) = 10. The derivative dQ/dP = -4. So, E = (-4) * (10/10) = -4, which is less than -1, indicating elastic demand.

If the Demand Function for a Particular Good Is Q