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5. Choosing demand elasticity on a graph Consider the demand for a luxury good such as a yacht. You can plot three different straight lines through the three points x, Y, and Z on this graph. Place the blue line (circle symbol) so that it goes through two of the points and shows the most likely demand curve for this type of good. Hint: Consider the relative elasticities of the different possible demand curves. 120 100 Demand Curve 80 メャ 60 40 20 6 10 12 14 16 LUXURY GOODS (Thousands per year) PRICE (Dollars per yacht)

5. Choosing demand elasticity on a graph Consider the demand for a luxury good such as a yacht. You can plot three different straight lines through the three points x, Y, and Z on this graph. Place the blue line (circle symbol) so that it goes through two of the points and shows the most likely demand curve for this type of good. Hint: Consider the relative elasticities of the different possible demand curves. 120 100 Demand Curve 80 メャ 60 40 20 6 10 12 14 16 LUXURY GOODS (Thousands per year) PRICE (Dollars per yacht)

Principles of Economics 2e
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 1SCQ: From the data in Table 5.5 about demand for smart phones, calculate the price elasticity of demand...
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5. Choosing demand elasticity on a graph Consider the demand for a luxury good such as a yacht. You can plot three different straight lines through the three points X, Y, and Z on this graph. Place the blue line (circle symbol) so that it goes through two of the points and shows the most likely demand curve for this type of good. Hint: Consider the relative elasticities of the different possible demand curves. 120 100 Demand Curve 80 60 40 20 4 10 12 14 16 LUXURY GOODS (Thousands per year) PRICE (Dollars per yacht)
Transcribed Image Text:5. Choosing demand elasticity on a graph Consider the demand for a luxury good such as a yacht. You can plot three different straight lines through the three points X, Y, and Z on this graph. Place the blue line (circle symbol) so that it goes through two of the points and shows the most likely demand curve for this type of good. Hint: Consider the relative elasticities of the different possible demand curves. 120 100 Demand Curve 80 60 40 20 4 10 12 14 16 LUXURY GOODS (Thousands per year) PRICE (Dollars per yacht)
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