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    Hi, just wanted to know if anyone could help me with these price elasticity of demand economics questions?

    1) calculate the value of Q1 when: P=20, P1=24, Q=1000 and price elasticity of demand= 0.75
    2) If a price rises by 5%, Q=1000 and price elasticity=0.5, find Q1
    3) If a price falls by 10%, Q=2000 and price elasticity=0.5, find Q1
    4) If the Quantity demanded has fallen by 2.5%, P=£2.50 and price elasticity=0.25
    What is P1?

    Thanks in advance
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    (Original post by iTDR)
    Hi, just wanted to know if anyone could help me with these price elasticity of demand economics questions?

    1) calculate the value of Q1 when: P=20, P1=24, Q=1000 and price elasticity of demand= 0.75
    2) If a price rises by 5%, Q=1000 and price elasticity=0.5, find Q1
    3) If a price falls by 10%, Q=2000 and price elasticity=0.5, find Q1
    4) If the Quantity demanded has fallen by 2.5%, P=£2.50 and price elasticity=0.25
    What is P1?

    Thanks in advance

    1) % Change in P = 24 - 20 / 20 = 0.2 x 100 = 20%

    PED Formula = % change in QD / % change in P
    0.75 = X / 20
    20 x 0.75 = 15
    15 = X,
    Therefore, % Change in QD = 15%
    1000 X 1.15 = 1150
    Value of Q1 = 1150.

    Now using the template above answer your other 4 questions, using % change in X formula with PED Formula while rearranging equations.
 
 
 
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