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Price Elasticity Of Demand 3

Price elasticity of demand

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Title: Price elasticity of demand

Essay Details:

Subject: Business

Author: Jermaine C

Date: February 16, 2016

Level: University

Grade: A

Length: 3 / 617

Essay text:

The data suggest that tastes didn’t change significantly, since the sales of all the newspapers held constant at around 2.5 million copies daily. The other table shows that the cut in the price of The Times shifted the Independent’s demand curve to the left. As you can see from table 1 a 40% price reduction of the price of The Times led to a 17.5% increase in its sales. This indicates a price elasticity of demand for The Times of-0.44 (percentage change in quantity demanded 17.5/-40 percentage change in price). As a result, The Times’ daily revenue fell from ?169,576 to ?134,689. Only if the price elasticity had been greater than 1 would total revenue have increased...

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