MHB Econ: Solving Elasticity Problem & Analyzing Revenue Function

[mathkid3]

The demand function for a product is given by p = 800 -4x, 0 <= X <= 200, where p is the price (in dollars) and x is the number of units.

(a) Determine when the demand is elastic, inelastic and of unit elasticity.

(b) Use the result of part (a) to describe the behavior of the revenue function.(Angry)

 

[pickslides]

The elasticity $E$ of a demand function $p(x) = 800-4x $ is given as $\displaystyle E = \frac{x\times p'(x)}{p(x)}$

 

[mathkid3]

hi,

Thanks for your help here. I am only in an Elementary Calculus 1 class and where I am sure your answer is correct...they have not introduced us to the formula you use.

What they have done is give us the following formula and I wanted to ask if you could respond again, taking this basic elementary formula and stating it again in a way I could proceed?

N = (p/x)/(dp/dx) They state this is
Formula for price
elasticity of demand

Thank you sir!

 

[CaptainBlack]

hi,

Thanks for your help here. I am only in an Elementary Calculus 1 class and where I am sure your answer is correct...they have not introduced us to the formula you use.

What they have done is give us the following formula and I wanted to ask if you could respond again, taking this basic elementary formula and stating it again in a way I could proceed?

N = (p/x)/(dp/dx) They state this is
Formula for price
elasticity of demand

Thank you sir!

If you consult the relevant Wikipedia page you will see that pickslides' definition of the elasticity is the standard definition, yours is the reciprical of this (see the note below about notation if you are not familiar with the dash notation for a derivative).

The same page gives you all the information you need to interpret the Elasticity, or if you are required to use the reciprical definition is easilly reinterpretable in terms of that since N=1/E the way you have defined it.

For your information:
\[ p'(x)=\frac{dp}{dx}\]
is what picksides notation denotes.

CB