Can you explain the answer of this question below:
Suppose the price of movies seen at a theatre rises form Rs. 120 per person to Rs.200 per person. The theatre manager observed that the rise in prices has lead to a fall in attendance at a given movie from 300 persons to 200 persons. What is the price elasticity of demand for the movie?
A: 0.5
B: 0.8
C: 1.00
D: 1.2
The answer is b.

CA Foundation Question

21 Answers
Ria Chauhan answered Jul 13, 2018
The correct answer is 0.8 by using arc elasticity method .0.5 is coming by solving question with point method .

MANEESHA.N.K answered Jan 31, 2020
Elasticity of demand =

 

Samitha Karnekar answered Jun 10, 2018
Arc elasticity : q1-q2 /q1+q2 × p1 +p2 /p1-p2. Where q1 =300 (0rg qty). q2=200(new qty) P1=120 (org price). P2=200 (new price)

Suvi answered May 21, 2019
By using arc method answer is 0.8
but in this answer is showing 0.5
if this Q will come in exam so which answer will be correct plz help

Parth Pachani answered Jun 24, 2018
Right answer is 0.8 because 200-300/200+300//200-120+200+120 100-/500//80/320 0.2/0.25 =0.8

Princy Jain answered Jun 11, 2018
Yes by using arc elasticity method 100/80*320/400

Diya Saxena answered Jan 30, 2020
Answer is b right ... by formula new demand - old demand ÷ old demand whole divided by new price - old price ÷ old price

Foxy Production answered Mar 08, 2019
All our suggestions and the exact answer for this question using arc elasticity method is 0.8( option-B )

Dilip Prajapath answered Apr 11, 2020
But sir they asked price elasticity method why we taking arc elasticity method..?

Mohammed Abbas answered Sep 28, 2019
Answer is B o.8

Jalib Baba answered Feb 25, 2020
Option (a) 0.5

Arnab Chatterjee answered Dec 20, 2019
The ans should be –0.5 since price elasticity is negative

Shravan Desai answered Sep 07, 2019
100/80×320/500=0.8

Roy Surbhi answered Apr 24, 2020
Answer is 0.5

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