Consider the demand curve D(p) )10-3p. What is the elasticity at … - Vidyadip

Question

Consider the demand curve D(p) )10-3p. What is the elasticity at price $\frac{5}{3} ?$

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Answer

Given, demand curve $D (p)=10-3 p$
$\quad$$\quad$Price $=\frac{5}{3}$
$D=10-3 \times \frac{5}{3}=10-5=5$
D=5 units
D(p)=10-3p
$\frac{\Delta D }{\Delta p}=-3 \quad$ or $\quad \frac{\Delta q}{\Delta p}=-3$
Elasticity of demand $\left( E _{ d }\right)=(-) \frac{p}{q} \times \frac{\Delta q}{\Delta p}$
$E_d=(-) \frac{\frac{5}{3}}{5} \times-3$
$E_d=(-) \frac{5}{3} \times \frac{1}{5} \times-3$
$E_d=1$
$\Rightarrow$
$\therefore$ Elasticity of demand $=1$.]

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