When tolls on the Dulles Airport Greenway were reduced from $1.75 to $1.00, traffic increased from 10,000 to 26,000 trips a day. Assuming all changes in quantity were due to the change in price, what is the price elasticity of demand for the Dulles Airport Greenway?

Price elasticity of demand, = 1.63

Explanation:

We know,

Price elasticity of demand, =

We will be using mid-point method to calculate the price elasticity.

Here,

Percentage change in Quantity demanded = × 100

or, Percentage change in Quantity demanded = × 100

Therefore, % change in Quantity demanded = × 100 = 88.89%

Again,

Percentage change in price = × 100

or, Percentage change in price = × 100

Therefore, Percentage change in price = × 100 = - 54.55%

Therefore, Price elasticity of demand, = 88.89% ÷ (- 54.55%) = 1.63

We know, price elasticity is always positive. Therefore, we have to give an absolute value for price elasticity.

answer; standing committee;

answer; swot analysis;