Question

The price elasticity is 0.5. The percentage change in quantity is 4. What is the % change in price?

Answer 1

Elasticity Coefficient = 0.5

% Change in Quantity = 4%

% Change in Price = Let this be X

Elasticity = `("% Change in Quantity")/("% Change in Price")`

0.5 = `(4%)/X`

X = `(4%)/0.5`

 = `40/5`

= 8%

The percentage change in price is 8%.