Answer to Question #328803 in Microeconomics for Yaasoni

Question

If the price elasticity of demand for tractors priced between $4,000 and $6,000 is -0.75 (using the mid-point method), what will be the percentage change in quantity demanded when the price for tractors falls from $6,000 to $4,000?

Answer 1

$-0.75 = x/((4000-6000)/(4000+6000)/2)$

$-0.75 = x/-0.4$

$x = -0.4 \cdot -0.75 = 0.3$

30%