28 24 20 S2 16 S1 12 8 4 D1 D2 4 8 12 16 20 24 Q 13. Assuming the change from D1 to D2 was caused by an increase in consumer income from $10,000 to $30,000, the income elasticity of demand at price=$20 is and this is alan product? "1/2, normal" "-1/2, normal" "2, normal " O "-2, inferior" O "1, inferior"

28 24 20 S2 16 S1 12 8 4 D1 D2 4 8 12 16 20 24 Q 13. Assuming the change from D1 to D2 was caused by an increase in consumer income from $10,000 to $30,000, the income elasticity of demand at price=$20 is and this is alan product? "1/2, normal" "-1/2, normal" "2, normal " O "-2, inferior" O "1, inferior"

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter6: Elasticities

Section: Chapter Questions

Problem 5P

See similar textbooks

Similar questions

Suppose household annual demand for gasoline follows the equation QD = 2000 – 500P + 25I where P is the price of a gallon of gasoline and I is household income in 1000s of dollars. Suppose that P = 3 and I = 60. What quantity of gasoline will households demand at this price and income level? __________ What is the income elasticity of demand for gasoline at this price, income, and quantity level? __________ What happens to the income elasticity of gasoline demand if I rises from 60 to 100? It _____________ (rises/falls) to ______________. Does this change in elasticity make gasoline buying more or less sensitive to income changes? __________
The likelihood that a child will attend a live musical performance can be modeled by q = 0.01(0.0007x2 + 0.38x + 36) (15 ≤ x ≤ 100). Here, q is the fraction of children with annual household income x thousand dollars who will attend a live musical performance during the year. Compute the income elasticity of demand E at an income level of $30,000. (Round your answer to two significant digits.) HINT [See Example 2.] E= Interpret the result. At a family income level of $ 30000, the fraction of children attending a live musical performance is increasing by____ % per 1% increase in household income.
P & A Ch 05 Q10 Consider public policy aimed at smoking. Studies indicate that the price elasticity of demand for cigarettes is about 0.2. If a pack of cigarettes currently costs $5 and the government wants to reduce smoking by 10%, it should increase the price by ? %. If the government permanently increases the price of cigarettes, the effect on smoking 1 year from now will be ( larger / smaller ) than the effect 3 months from now. Studies also find that teenagers have a higher price elasticity of demand than do adults. Which of the following statements are consistent with this result? Check all that apply. Adults are more likely to be addicted to cigarettes. Teenagers do not have as much income as adults, so they are more price sensitive. It is legal for adults to consume alcohol, so many choose to spend their money on that good rather than cigarettes.
The demand equation for cans of chicken is Qd= 60-3p Suppose the price of a can of chicken increases from $5 to $10. The price elasticity of demand is _________ (use decimals if necessary). We classify this price elasticity of demand as ____ over the $5 to $10 price change. A. Elastic B.Inelastic C.Unit elastic
Please Explain in details If chocolate bars have a price elasticity of 0.6, then we can infer the chocolate bar Multiple Choice has many substitutes and sellers could raise price to increase revenue from sales. is a luxury good and sellers could raise price to increase revenue. is a necessity and sellers could raise price to increase revenue. has few substitutes and sellers could lower price to increase revenue from sales
The estimated monthly sales of Mona Lisa paint-by-number sets is given by the formula q = 95ep − 3p2⁄2, where q is the demand in monthly sales and p is the retail price in hundreds of yen. (a)Determine the price elasticity of demand E when the retail price is set at ¥300. E = Interpret your answer. The demand is going by % per 1% increase in price at that price level. Thus, a large price ___ is advised. (b)At what price will revenue be a maximum? (Round your answer to the nearest integer.) yen (c)Approximately how many paint-by-number sets will be sold per month at the price in part (b)? (Round your answer to the nearest integer.) paint-by-number sets per month
H6. At what price and quantity is the point-price elasticity of Q=70-.4P -1? Please show algebraically
The likelihood that a child will attend a love musical performance modeled by: q=0.01(0.0005x2+0.41x+36). (15=<x=<100) Here, q is the fraction of children with unusual household income x thousand dollars who will attend a live musical performance during the year. Compute the income elasticity of Demand E at an income level of $30 000.
Which of the following products is likely to have the lowest price elasticity of demand during pandemic Covid 19? A. air ticket B. branded handbags C. smart phone gadgets D. cooking oil
3.1 Distinguish amongst the main categories of elasticity. Include in your answer the provision of their formular.
Transport economists Lasse Fridstrøm and Vegard Østli studied the demand for cars in Norway between 2002 and 2016. Regarding gasoline-powered cars, the own-price elasticity was −1.094, and the cross-price elasticities with respect to the prices of gasoline, electricity, and electric cars were −0.71, 0.06, and 0.19 respectively. As for electric cars, the own-price elasticity was −0.99, and the cross-price elasticities with respect to the prices of electricity, gasoline, and gasoline-powered cars were −0.18, 0.38, and 0.35 respectively.a. Referring to the above data, discuss whether gasoline cars and electricity are substitutes or complements.b. Electric cars are more expensive than gasoline cars. Compare the incomes of people who buy electric cars vis-à-vis those who buy gasoline cars.c. Considering the buyers’ incomes, explain why the demand for electric cars is less price elastic than the demand for gasoline cars.d. Why would the short-run demand for gasoline cars be less elastic with…
The estimated monthly sales of Mona Lisa paint-by-number sets is given by the formula q = 95e−3p2 + p, where q is the demand in monthly sales and p is the retail price in hundreds of yen. (a) Determine the price elasticity of demand E when the retail price is set at ¥400. E = _____ Interpret your answer. The demand is going down/up by ____ % per 1% increase in price at that price level. Thus, a large price decrease/increase is advised. (b) At what price will revenue be a maximum? ____ hundred yen (c) Approximately how many paint-by-number sets will be sold per month at the price in part (b)? (Round your answer to the nearest integer.) ______ paint-by-number sets per month