Consider two markets: the market for cat food and the market for dog food. The initial equilibrium for both markets is the same, the equilibrium price is $6.50, and the equilibrium quantity is 35.0. When the price is $8.75, the quantity supplied of cat food is 55.0 and the quantity supplied of dog food is 111.0. For simplicity of analysis, the demand for both goods is the same. Using the midpoint formula, calculate the elasticity of supply for dog food. Please round to two decimal places. 1.81

ECON MICRO
5th Edition
ISBN:9781337000536
Author:William A. McEachern
Publisher:William A. McEachern
Chapter5: Elasticity Of Demand And Supply
Section: Chapter Questions
Problem 1.1P: (Calculating Price Elasticity of Demand) Suppose that 50 units of a good are demanded at a price of...
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Consider two markets: the market for cat food and the market for dog food. The initial equilibrium for both markets is the same,
the equilibrium price is $6.50, and the equilibrium quantity is 35.0. When the price is $8.75, the quantity supplied of cat food is
55.0 and the quantity supplied of dog food is 111.0. For simplicity of analysis, the demand for both goods is the same.
Using the midpoint formula, calculate the elasticity of supply for dog food. Please round to two decimal places.
1.81
Supply in the market for cat food is
There is not enough information to tell which has a higher elasticity.
the same elasticity as supply in the market for dog food.
more elastic than supply in the market for dog food.
less elastic than supply in the market for dog food.
Transcribed Image Text:Consider two markets: the market for cat food and the market for dog food. The initial equilibrium for both markets is the same, the equilibrium price is $6.50, and the equilibrium quantity is 35.0. When the price is $8.75, the quantity supplied of cat food is 55.0 and the quantity supplied of dog food is 111.0. For simplicity of analysis, the demand for both goods is the same. Using the midpoint formula, calculate the elasticity of supply for dog food. Please round to two decimal places. 1.81 Supply in the market for cat food is There is not enough information to tell which has a higher elasticity. the same elasticity as supply in the market for dog food. more elastic than supply in the market for dog food. less elastic than supply in the market for dog food.
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