(Solution) - Suppose there are two types of e book consumers 100 standard -(2025 Original AI-Free Solution)

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Academic Level: Undergrad. (yrs 3-4)

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Pages: 5 Words: 1375

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Suppose there are two types of e-book consumers: 100 ?standard? consumers with demand Q = 20 - P and 100 ?rule-of-thumb? consumers who buy 10 e-books only if the price is less than $10. (Their demand curve is given by Q = 10 if P < 10 and Q = 0 if P > 10.) Draw the resulting total demand curve for e-books. How has the ?rule-of-thumb? behavior affected the elasticity of total demand for e-books?