Question

Suppose that when the price of good A rises from $18 to $20, the quantity demanded...

Suppose that when the price of good A rises from $18 to $20, the quantity demanded of good B falls from 30 units to 20 units.

Using the midpoint method, the cross-price elasticity of demand is

Select one: a. -0.26, where goods A and B are complements.

b. -0.26, where goods A and B are substitutes.

c. -3.8, where goods A and B are complements.

d. -3.8, where goods A and B are substitutes.

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

OPTION C

if you have any doubt ask in comment i will reply asap.

If you like the answer give thumbs up.

Thank you ?

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
b) When the price of Good A is $27, the quantity demanded of Good B is...
b) When the price of Good A is $27, the quantity demanded of Good B is 1,200 units. When the price of Good A falls to $23 the quantity demanded of Good B falls to 800 units. i. Calculate the cross elasticity of demand ii. Are the goods substitutes or complements? Explain your choice. c. Explain how cross elasticity of demand is used. d. Explain how income elasticity of demand is used.
A measure of the rate of percentage change of quantity demanded with respect to price, holding...
A measure of the rate of percentage change of quantity demanded with respect to price, holding all other determinants of demand constant is a. Income elasticity of demand b. Own price elasticity of demand c. Price elasticity of market equilibrium d. Cross price elasticity of demand The value of the income elasticity of demand coefficient for Good X is  given as 0.1. This means that a. as income increases by 10 percent, quantity demanded rises by 1 percent. b. as income...
If, as the price of good Y rises from $5.00 to $5.75, the quantity demanded of...
If, as the price of good Y rises from $5.00 to $5.75, the quantity demanded of good Y falls from 54 units to 48 units, price elasticity of demand for good Y in this price range is Question 7 options: a) 0.84. b) 0.37. c) 1.05. d) 4.77. e) 1.19.
Suppose that when the price of water rises by 30 percent, the quantity demanded falls by...
Suppose that when the price of water rises by 30 percent, the quantity demanded falls by 10 percent. The price elasticity of demand for water is ____________, making water an _______________ good (in this example).
The price of good A went from $2 to $2.50 and the quantity of good B...
The price of good A went from $2 to $2.50 and the quantity of good B went from 50 units to 40 units. If you use arc elasticity, cross-price elasticity is _____ and goods A and B are _____. a. -1; substitutes. b. +1; complements. c. +1; substitutes. d. -1; complements.
Determine the price elasticity of demand, the cross-price elasticity of demand or the income elasticity in...
Determine the price elasticity of demand, the cross-price elasticity of demand or the income elasticity in the following scenarios. a. Consider the market for coffee. Suppose the price rises from $4 to $6 and quantity demanded falls from 120 to 80. What is price elasticity of demand? Is coffee elastic or inelastic? b. John’s income rises from $20,000 to $22,000 and the quantity of hamburger he buys each week falls from 2 pounds to 1 pound. What is his income...
Assume QA = 4,900 - 60*PA + 10*PB, where QA is the quantity of good A...
Assume QA = 4,900 - 60*PA + 10*PB, where QA is the quantity of good A demanded, PA is the price of good A, and PB is the price of good B. a) Suppose at first PA = $49 and PB = $50. Then the price of good A rises to PA' = $51 (while PB remains $50). Using the arc or midpoint formula, calculate the price elasticity of demand for good A. ED = b) Now suppose at first...
When the price is $2, quantity demanded is 10. When the price rises to $8, quantity...
When the price is $2, quantity demanded is 10. When the price rises to $8, quantity demanded falls to 2. What is the value of the elasticity of demand? Is it elastic or inelastic?
The following table provides the demand for three goods (A, B, and C) at two prices...
The following table provides the demand for three goods (A, B, and C) at two prices for good A. Price of GOOD A Quantity Sold of A Quantity Sold of B Quantity Sold of C $30 1400 400 500 $40 700 210 825 a) Calculate the midpoint cross-elasticity of demand between good A and B. Are these goods substitutes or complements? b) Calculate the midpoint cross elasticity of demand between good A and C. Are these goods substitutes or complements?
2.) For a certain good, when the good’s price falls from $22 to $20, its quantity...
2.) For a certain good, when the good’s price falls from $22 to $20, its quantity demanded rises from 2,000 to 2,200 units. Given this information, find the price elasticity of demand two different ways. First, use the elasticity of demand formula. Second, use the total revenue test. You must use both methods. show all work for credit.
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT