Compute price elasticity of demand using midpoint formula

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Review of elasticity. Suppose that when the price of gasoline changes from $2 to $1.50, the quantity demanded of gasoline decreases in Manhattan from 800 gallons per day to 960 gallons. Compute the price elasticity of demand using the midpoint formula. Show your work to get full credit. The gasoline elastic or inelastic?

Reference no: EM13998491

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