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1. When the local grocery store puts peanut butter on sale, reducing its price from $4.00 per item to $3.50 per item, the quantity sold increases from 210 per week to 230 per week. This response illustrates which of the following concepts?

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Box 1: Select the best answer

2. What does this concept represent?

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3. Let's look at the first part of the formula. How do we find the percentage change in quantity using the midpoint formula?

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4. How do we express the percentage change in quantity using the variables Q

_{1}(original quantity) and Q_{2}(new quantity)?
Hint

Box 1: Select the best answer

5. Now calculate the percentage change in quantity demanded by plugging in the numbers for Q

percentage change in quantity demanded =

_{1}and Q_{2}.percentage change in quantity demanded =

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Box 1: Enter your answer as an integer or decimal number. Examples: 3, -4, 5.5172

Enter DNE for Does Not Exist, oo for Infinity

6. Now let's look at the second part of the formula. How do we find the percentage change in price using the midpoint formula?

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Box 1: Select the best answer

7. How do we express this using the variables P

_{1}(original price) and P_{2}(new price)?
Hint

Box 1: Select the best answer

8. Now plug in the numbers for P1 and P2 to calculate the percentage change in price.

Box 1: Enter your answer as an integer or decimal number. Examples: 3, -4, 5.5172

Enter DNE for Does Not Exist, oo for Infinity

9. Finally, using the whole formula, calculate the value of the price elasticity of demand for peanut butter.

price elasticity of demand =

price elasticity of demand =

Hint

Box 1: Enter your answer as an integer or decimal number. Examples: 3, -4, 5.5172

Enter DNE for Does Not Exist, oo for Infinity

10. Explain what this result means in words. Then click 'Submit' to compare your answer to ours.

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Box 1: Enter your answer as text. This question is not automatically graded.