https://file.aiquickdraw.com/mathbot/file/17276314759770n338cm4.jpg

Let's work through the table and calculations step by step using the provided data.

### Step 1: Fill in the appropriate values
- **Original quantity**: 353,000 headsets
- **New quantity**: 499,000 headsets
- **Original price**: \$4,500
- **New price**: \$4,300

Now we will move on to the calculations.

---

### Step 2: Calculate the averages

- **Average quantity**:
  \[
  \text{Average quantity} = \frac{353,000 + 499,000}{2} = 426,000 \text{ headsets}
  \]

- **Average price**:
  \[
  \text{Average price} = \frac{4500 + 4300}{2} = 4400 \text{ dollars}
  \]

---

### Step 3: Calculate the changes

- **Change in quantity**:
  \[
  \text{Change in quantity} = 499,000 - 353,000 = 146,000 \text{ headsets}
  \]

- **Change in price**:
  \[
  \text{Change in price} = 4,300 - 4,500 = -200 \text{ dollars} \quad (\text{decrease, so it's negative})
  \]

---

### Step 4: Calculate the percentage changes

- **Percentage change in quantity**:
  \[
  \text{Percentage change in quantity} = \frac{146,000}{426,000} \times 100 \approx 34.27\%
  \]

- **Percentage change in price**:
  \[
  \text{Percentage change in price} = \frac{-200}{4400} \times 100 \approx -4.55\%
  \]

---

### Step 5: Calculate the price elasticity of demand

Using the midpoint formula for elasticity of demand:
\[
\text{Elasticity of demand} = \frac{\text{Percentage change in quantity}}{\text{Percentage change in price}} = \frac{34.27\%}{-4.55\%} \approx -7.53
\]

---

So, the price elasticity of demand is about **-7.53**, meaning the demand is highly elastic.

Would you like to go over any part of this in more detail?

---

Here are five related questions:
1. What does a negative price elasticity of demand indicate?
2. How would the elasticity change if the price decrease was smaller?
3. What is the significance of highly elastic demand for a business?
4. How can we interpret elasticity greater than 1 in absolute value?
5. What is the midpoint method, and why is it used?

**Tip**: Always remember that elasticities are unitless, meaning they help compare percentage changes across different scales!

Suppose that during the past year, the price of a virtual reality headset fell from $4,500 to $4,300. During the same time period, consumer sales increased from 353,000 to 499,000 headsets. Calculate the elasticity of demand between these two price–quantity combinations.

Learn how to calculate the price elasticity of demand for virtual reality headsets using the midpoint method. This example features price changes from $4,500 to $4,300 and sales growth from 353,000 to 499,000 units, demonstrating how elasticity reveals consumer sensitivity to price changes. Ideal for college economics students.

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