Name___________ Assignment-Elasticity

Q1. Calculate values of Price Elasticity for all the situations below:

Price Quantity % change in quantity % change in Elasticity of

Initial New Initial New demanded price Demand

25 30 100 40 1. ___________

40 70 120 90 2. ___________

200 220 80 64 3. ___________

50 75 150 135 4. ___________

Q2. In each case identify whether you would describe it as elastic / unitary elastic / inelastic
1. _________________________ 2. _________________________
3. _________________________ 4. _________________________

Q3. Judge the products in the table below to decide whether you think they will be elastic or inelastic:

Product Elastic or inelastic? Why?

Salt

Hawaiian Vacation

Apple iPhone

Cigarettes

Tap Water

Gasoline

Dasani Water

Cooking oil

Heart medication

Oriental rugs

Chocolate
 'Heinz' baked beans
Q4. At a price of $300.00 the quantity demanded is 100 pairs of the new Yeezy shoes. Kanye West
decides to drop the price of his shoes to $200 and suddenly the quantity demanded jumps up to
150 pairs of shoes. Are the shoes an elastic or inelastic good?

Initial Price:
Initial Quantity Demanded:
New Price:
New Quantity Demanded:

Is the good Elastic or Inelastic? (Circle One)

Value:

Q5. At a price of $3.00 the quantity supplied is 2000 gallons. Hurricane Harvey comes through and
gas prices rise to $4.00. Now the quantity supplied is 4000 gallons. In this example an elastic or
inelastic commodity?

Initial Price:
Initial Quantity Supplied:
New Price:
New Quantity Supplied:

Is the good Elastic or Inelastic? (Circle One)

Value:

Q6. The new price of fidget spinners is $5.00 and at this price the quantity demanded is 1500.
Originally however, the fidget spinner sold for $10.00 and the quantity demanded was 1200

Initial Price:
Initial Quantity Demanded:
New Price:
New Quantity Demanded:

Is the good Elastic or Inelastic? (Circle One)

Value:

Q7. Yesterday, the price of envelopes was $3 a box, and Julie was willing to buy 10 boxes. Today, the
price has gone up to $3.75 a box, and Julie is now willing to buy 8 boxes. Is Julie's demand for
envelopes elastic or inelastic? What is Julie's elasticity of demand?

Q8. Katherine advertises to sell cookies for $4 a dozen. She sells 50 dozen, and decides that she can
charge more. She raises the price to $6 a dozen and sells 40 dozen. What is the elasticity of
demand?