1 Suppose Dp is the demand curve for plantain, and it is givenas;Dp = 5000 – 3P, + 5Py – Pc + 0.1Y1 where P, is price of plantain, Py is price of yam, Pc is price ofcassava, Y is income of the consumer.1 Given P, = 200, P, = 300, P. = 500 and Y = 5000 calculate1 Price elasticity of demand2 Cross-Price elasticity of demand3 Income elasticity of demand1 From your estimations, what inferences can be drawn aboutthe nature of plantain to the consumer.

Plugging given values, Dp = 5000 - 3 x 200 + 5 x 300 - 500 + 0.1 x 5000 = 5000 - 600 + 1500 - 500 +…

1 Suppose D, is the demand curve for plantain, and it is given as; Dp = 5000 – 3P, + 5Py – Pc + 0.1Y 1 where P, is price of plantain, Py is price of yam, Pc is price of cassava, Y is income of the consumer. 1 Given P, = 200, Py = 300, Pc = 500 and Y = 5000 calculate %3D 1 Price elasticity of demand 2 Cross-Price elasticity of demand 3 Income elasticity of demand

1 Suppose D, is the demand curve for plantain, and it is given as; Dp = 5000 – 3P, + 5Py – Pc + 0.1Y 1 where P, is price of plantain, Py is price of yam, Pc is price of cassava, Y is income of the consumer. 1 Given P, = 200, Py = 300, Pc = 500 and Y = 5000 calculate %3D 1 Price elasticity of demand 2 Cross-Price elasticity of demand 3 Income elasticity of demand

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter5: Elasticity

Section: Chapter Questions

Problem 2SCQ: From the data in Table 5.6 about supply of alarm clocks, calculate the price elasticity of supply...

See similar textbooks

Similar questions

Using the midpoint formula for calculating the elasticity of supply, if the price of a good rose from $95 to $105, what would be the elasticity of supply if the quantity supplied changed from a. 38 to 42? b. 78 to 82? c. 54 to 66?
Why is the supply curve with constant unitary elasticity a straight line?
What is the relationship between price elasticity and position on the demand curve? For example, as you move up the demand curve to higher prices and lower quantities, what happens lo the measured elasticity? How would you explain that?
Would you expect supply to play a more significant role in determining the price of a basic necessity like food or a luxury like perfume? Explain. Hint: Think about how the price elasticity of demand will differ between necessities and luxuries.
If supply is elastic, will shifts in demand have a larger effect on equilibrium quantity or on price?
Suppose you could buy shoes one at a time, miter than in pain. What do you predict the cross-price elasticity for left shoes and right shoes would be?
An increase in the supply of a good will decrease the total revenue producers receive if a. the demand curve is inelastic. b. the demand curve is elastic. c. the supply curve is inelastic. d. the supply curve is elastic.
If demand is elastic, will shifts in supply have a larger effect on equilibrium quantity or on price?
Describe the general appearance of a demand or a supply curve with infinite elasticity.
From the data in Table 5.6 about supply of alarm clocks, calculate the price elasticity of supply from: point J to point K, point L to point M, and point N to point P. Classify the elasticity at each point as elastic, inelastic, or unit elastic.
Why is the demand curve with constant unitary elasticity concave?