Neco 2024 Economics Question 3

The table below shows the quantity demanded of wheat flour (in kilograms) at three different price levels in a local market. | Price (₦ per kg) | Quantity demanded (kg) | |------------------|------------------------| | 200 | 500 | | 250 | 460 | | 300 | 420 | Using the data above, answer the following: a) Calculate the price elasticity of demand between the price of ₦200 per kg and ₦250 per kg. Show all steps. b) Based on the elasticity obtained, state whether demand is elastic, unit‑elastic or inelastic in that range and explain the implication for total revenue when price rises from ₦200 to ₦250. c) Suppose the price of rice (a substitute for wheat flour) increases by 10 % and, as a result, the quantity demanded of wheat flour rises from 500 kg to 560 kg. Compute the cross‑price elasticity of demand for wheat flour with respect to rice and interpret the result.