The Kahoot provides an interesting example of the price elasticity of demand for water. Students are given enough information to calculate the price elasticity using the midpoint method. Since the coefficient is negative and between 0 and -1, the price elasticity of demand in inelastic – that is the correct answer. However, many students object, stating that they would never pay $5 for bottled water (their demand in elastic), to which you should respond, “It’s the Hilton, as long as bottled water drinkers value the convenience more that then extra price they pay, their demand is inelastic. Don’t confuse what you would do with what others decide to do.”
Course Used: Principles of Micro
Quiz Nature: Discussion starter
Question Length: 1
Estimated Time to Play: 3-5 minutes with explanation.
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