Test Yourself, Exercise 2.5 1.With reference to the demand schedule in Figure 2.2 calculate the arc elasticity ofdemand between the prices of (a) £3 and £6, (b) £6 and £9, (c) £9 and £12, (d) £12and...

Test Yourself, Exercise 2.5
1.With reference to the demand schedule in Figure 2.2 calculate the arc elasticity ofdemand between the prices of (a) £3 and £6, (b) £6 and £9, (c) £9 and £12, (d) £12and £15, and (e) £15 and £18.A city bus service charges a uniform fare for every journey made. When this fareis increased from 50p to £1 the number of journeys made drops from 80,000 a day2.
to 40,000. Calculate the arc elasticity of demand over this section of the demand
schedule for bus journeys.
3. Calculate the are elasticity of demand between (a) £5 and £10, and (b) between
£10 and £15, for the demand schedule shown in Figure 2.3.
LPrice
15
10
D
40
80
120 Quantity
0