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Welcome to the Q&A for ECN/APEC 2010, where you can ask questions and receive answers from your fellow students, the TA, and your professor.

Please only ask questions about the material for the course. Try to create discussions about the material we see in class, instead of just thinking of economics in general (this is an introduction to microeconomics class, not a policy or government class).

For questions and discussions about course organization or other course related topics, come see us after class or during office hours.

Feel free to discuss quiz questions on the Q&A, but do not provide direct answers to quiz questions before the quiz's due date.

Midterm 1 Question

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The current price in the agricultural lettuce market is set by the government, and  is such that the price of lettuce is 25% higher than equilibrium price and 100 heads of lettuce are demanded.

Suppose that the elasticity of demand for lettuce is -0.50. What would be the equilibrium quantity of lettuce if the government removed its restriction on the price of lettuce?

(You can assume that the elasticity of demand is constant along the demand curve)

Why is the answer Quantity = 112.5
asked Apr 29 by canvas-e25408d8f8d15 (216 points)
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