Mathematics Stack Exchange is a question and answer site for people studying math at any level and professionals in related fields. It only takes a minute to sign up.
Sign up to join this community
PED Equation = $ \frac{1}{0.4+0.00005Q}$
Demand Function is $$P = 920Q^{-0.4}e^{-0.00005Q},$$
$$ \epsilon_𝑑 = −1.89.$$
What is the price at the above level? And how would i see the quantity at that specific price?
I'm at a loss. I tried to make $-1.89$ equal to the PED equation, which ended up getting me a $Q$ value but obviously that is wrong as you would need to find the price before the quantity.
It is not true that "you would need to find the price before the quantity". The demand function is a bijection so you could solve for either one first. Starting with the information about the elasticity of demand you get $$-\frac{1}{0.4+0.00005Q}=-1.89 \;\Rightarrow Q=2582$$ Substituting this into the (inverse) demand function $$P = 920*2582^{-0.4}e^{-0.00005*2582}=34.909$$
