A firm sells 420 units of a good when it charges a price of $24. When it charges a price of $28 it sells 480 units. What is the price elasticity of demand (in absolute value)?

0.87

Explanation:

Price elasticity is defined as a measure of how responsive the quantity of a product demanded is to changes in its price.

It is important in determining how price changes affects the demand of a product.

The supplier uses this to gauge how an increase in price will affect demand and by extension their profits.

It is calculated by finding ratio of percentage change in quantity to percentage change in price.

Price elasticity = (% change in quantity demanded) ÷ (%change in price)

Change in quantity demanded = (480-420) ÷420 = 0.143

Change in price = (28-24) ÷ 24 = 0.167

Price elasticity = 0.143 ÷ 0.167 = 0.87

being born in poverty would limit the people's chances, opportunities and benefits.

this happen because of several things, such as:

- poor people tend to gain less access to good education and nutrition. this mean that their chance to obtain high paying jobs would also be limited.

- poor people tend to socialize with other poor people while the rich tend to socialize with other rich people. this means that simply throguh their social circle, rich people would have more business opportunities compared to the poor people.

- rich people tend to have more capital in their disposal. this would benefit them in business since it is far easier for them to fund their business operation compared to poor people.