1. The demand for good X is given by Qdx = 1,200 -P+P,-8P, +M. Research shows that the prices ofrelated goods are given by Py-PHP 5,900 and P=PHP $90, while the average income of individuals consuming this productis M=PHP 55,000.a. How many units of the good X will be purchased when P,= PHP 4,910? (Interpret your result.)b. Calculate the Own price elasticity using the function. Is it elastic? or inelastic? (Interpret your result.)c. Calculate the Cross-price elasticity using P, as the price of related goods. Are good Y substitutes? Orcomplements? (Interpret your result.)d. Calculate the Cross-price elasticity using Pz as the price of related goods. Are good Z substitutes? Orcomplements? (Interpret your result.)e. Calculate the Income Price elasticity. Is X an inferior good? Luxury? Or Necessity? (Interpret your result.)f. InP+InP,- 8lnP, +InM,Suppose that the demand function is in log-linear form: InQdx 7-and the that the prices of related goods are given by P,=PHP 5,900 and P=PHP $90, while the average incomeof individuals consuming this product is M-PHP 55,000. Also, the good X will be purchased when P= PHP 4,910.How much is the projected quantity demanded for good X? Interpret your result.

Since you have provided multiple subparts questions, we will solve the first three sub-parts for…

1. The demand for good X is given by Qdx = 1,200 -P,+,-8P, +M. Research shows that the prices of related goods are given by P-PHP 5,900 and P-PHP $90, while the average income of individuals consuming this product is M=PHP 55,000. a. How many units of the good X will be purchased when P= PHP 4,910? (Interpret your result.) b. Calculate the Own price elasticity using the function. Is it elastic? or inelastic? (Interpret your result.) c. Calculate the Cross-price elasticity using P, as the price of related goods. Are good Y substitutes? Or complements? (Interpret your result.) Colculato the Crocc prico olacticity ucing R or the prico of rolatod goods Aro good 7 cubctitutoc? Or

1. The demand for good X is given by Qdx = 1,200 -P,+,-8P, +M. Research shows that the prices of related goods are given by P-PHP 5,900 and P-PHP $90, while the average income of individuals consuming this product is M=PHP 55,000. a. How many units of the good X will be purchased when P= PHP 4,910? (Interpret your result.) b. Calculate the Own price elasticity using the function. Is it elastic? or inelastic? (Interpret your result.) c. Calculate the Cross-price elasticity using P, as the price of related goods. Are good Y substitutes? Or complements? (Interpret your result.) Colculato the Crocc prico olacticity ucing R or the prico of rolatod goods Aro good 7 cubctitutoc? Or

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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In consumer theory economics, what is the difference between a necessity and a luxury good. What is the likely difference in the tax revenue obtained from a tax imposed on a necessity versus a luxury good? Explain and illustrate with appropriate figures.
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Jenny has a utility function U(x, y) = 2xy + 1. The price of x is $1 and the price of y is $1, and her income is $20. A. How much x and y does Jenny demand? B. A tax is placed on x so that x now costs Jenny $2 while her income and the price of y stay the same. How much of good x does she now demand? C. Would Jenny be as well off as she was before the tax if when the tax was imposed, her income rose by an amount equal to $1 times the answer to part (b)?
Suppose that a person regards ham and cheese as pure complements—he or she will always use one slice of ham in combination with one slice of cheese to make a ham and cheese sandwich. Suppose also that ham and cheese are the only goods that this person buys, and that bread is free.6.1. If the price of ham is equal to the price of cheese, show that the own-price elasticity of demand for ham is –0.5 and that the cross-price elasticity ofdemand for ham with respect to the price of cheese is also –0.5.6.2. Explain why the results from (6.1) reflect only income effects, not substitution effects. What are the compensated price elasticities in this problem?6.3. Use the results from (6.2) to show how your answers to (6.1) would change if a slice of ham cost twice the price of a slice of cheese.
Please written by hand solution The demand for good X is given by QXd = 6,000 - (1/2)PX - PY + 9PZ + (1/10)M Research shows that the prices of related goods are given by Py = $6,500 and Pz = $100, while the average income of individuals consuming this product is M = $70,000. a. Indicate whether goods Y and Z are substitutes or complements for good X. Good Y is: (Click to select) a substitute neither complement nor substitute a complement . Good Z is: (Click to select) a complement a substitute neither complement nor substitute . b. Is X an inferior or a normal good? Good X is: (Click to select) an inferior good neither a normal nor an inferior good a normal good . c. How many units of good X will be purchased when Px = $5,230? d. Determine the demand function and inverse demand function for good X. Graph the demand curve for good X. Instruction: Enter all values as integers, or if needed, a decimal rounded to one decimal place. Demand function: ( ) - ( ) PX…