The answer is 2.40 but i dont understand the workings. can someone please explain in steps how to get the answer ?
If we consider $12 as the original price and 4000 units as the original quantity demanded. Then, PED = (20000-4000)/4000
______________
(2.4-12)/12
PED = 5,
which is not equal to 1.
If we consider $12 as the original price and 4000 units as the original quantity demanded. Then, PED = (20000-4000)/4000
______________
(2.4-12)/12
PED = 5,
which is not equal to 1.