Answer to Question #317397 in Microeconomics for Boo

Question

Given the demand function Qx = 8000-1000Px, determine the elasticity of demand at a single 

point where price of Rs. 6 and the corresponding quantity of 2000 units. (Diagram is required)

Answer 1

$\epsilon=\frac{dQ_x}{dP_x}×\frac{P_x}{Q_x}$

Where

$\frac{dQ_x}{dP_x}=-1000$

Px=Rs.6

Qx=2000

$\epsilon=-1000×\frac{6}{2000}$

$\epsilon=-3$