If the Price of Burritos Increases from $4 to $6

question 171

Essay

If the price of burritos increases from $4 to $6 and customers decrease their consumption from 20 to 10 burritos, what is the price elasticity of demand (using the midpoint method)?
A.5/3
B.2/3
C.3
D.2

---

Definitions:

Curvilinear Cost

A cost structure where costs increase at a non-constant rate as volume increases, depicting a curve on a graph.

Variable Cost

Refers to expenses that vary in proportion to the volume of goods or services produced.

Nonconstant Rate

Refers to a rate or percentage that varies over time or across different situations, not fixed or uniform.

Break-Even Point

The level of production or sales at which total revenues equal total costs, resulting in no net loss or gain.