Suppose the Inverse Demand for a Good Is Given by P

question 139

Essay

Suppose the inverse demand for a good is given by P = 6 - Q.
a. What is the price elasticity of demand at P = $3? Is demand elastic at this price?
b. If consumers are willing to pay $2 more per unit, what is the price elasticity of demand at P = $3? Is demand elastic at this price?

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