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Suppose at apriceof $10 the quantity demanded is 100. When thepricefalls to $8, the quantity demanded increases to 130. Thepriceelasticity of demand between thepricesof $10 and $8, using the midpoint method, is approximately:

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The estimated value of the threshold varies considerably between studies. Using annual data for 87 countries over the period 1970-1990, Sarel (1996) estimates that there is a structural break in the relationship between inflation and growth at inflation rates of around 8%.