Answer:
0.5
Explanation:
A company raise its price from $20 to $24
Change in price = 24-20/20
= 4/20
= 0.2
The quantity demanded falls from 10,000 units to 9,000 units
Change in quantity= 9,000-10,000/10,000
= -1000/10000
= -0.1
Therefore the price elasticity of demand can be calculated as follows
= -0.1/0.2
= 0.5
Hence the price elasticity of demand is 0.5
