Which of the Following Expressions Can Be Used to Compute $\frac{Q_{1}-Q_{1}}{\left(Q+Q_{2}\right) / 2} * \frac{P_{1}+P_{2}}{\left(P_{2}-P_{1}\right) / 2}$

question 123

Multiple Choice

Which of the following expressions can be used to compute the price elasticity of demand?

• A)Price elasticity of demand = \( \frac{Q_{1}-Q_{1}}{\left(Q+Q_{2}\right) / 2} * \frac{P_{1}+P_{2}}{\left(P_{2}-P_{1}\right) / 2} \)
• B)Price elasticity of demand = \( \frac{\left(Q+Q_{2}\right) / 2}{\left(Q_{1}-Q_{2}\right) / 2} * \frac{\left(P_{2}-P_{1}\right) / 2}{\left(P_{2}+P_{1}\right) / 2} \)
• C)Price elasticity of demand = \( \frac{Q_{2}-Q_{1}}{Q_{1}+Q_{2}} * \frac{P_{1}+P_{2}}{P_{2}-P_{1}} \)
• D)Price elasticity of demand = \( \frac{Q_{2}-Q_{1}}{Q_{1}+Q_{2}} * \frac{P_{2}-P_{1}}{P_{1}+P_{2}} \)

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Definitions:

Bank Deposits

Money placed into banking institutions for safekeeping, which can include savings accounts, checking accounts, and certificates of deposit.

Lending

The act of providing funds to another party with the expectation that the funds will be repaid, often with interest, over a specified period of time.

Excess Reserves

Funds that banks hold over and above the legal requirements, which can influence their ability to lend.

Deposits

Funds placed into an account at a financial institution for safekeeping and to earn interest.