Suppose an 18 percent drop in the price of strawberries leads to a 24 percent increase in the quantity demanded of strawberries and a 12 percent decrease in the quantity demanded of plums.   a. What is the price elasticity of demand for strawberries?   Instructions: Enter your response rounded to two decimal places.       b. At the current price level, the demand for strawberries is              because the price elasticity of demand for strawberries is                 .   c. What is the cross-price elasticity of demand between strawberries and plums?   Instructions: Enter your response rounded to two decimal places.       d. Strawberries and plums are                 because the cross-price elasticity of demand is

Microeconomics
13th Edition
ISBN:9781337617406
Author:Roger A. Arnold
Publisher:Roger A. Arnold
Chapter6: Elasticity
Section: Chapter Questions
Problem 11QP: Suppose you learned that the price elasticity of demand for wheat is 0.7 between the current price...
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Suppose an 18 percent drop in the price of strawberries leads to a 24 percent increase in the quantity demanded of strawberries and a 12 percent decrease in the quantity demanded of plums.

 

a. What is the price elasticity of demand for strawberries?

 

Instructions: Enter your response rounded to two decimal places.

 

 

 

b. At the current price level, the demand for strawberries is              because the price elasticity of demand for strawberries is                 .

 

c. What is the cross-price elasticity of demand between strawberries and plums?

 

Instructions: Enter your response rounded to two decimal places.

 

 

 

d. Strawberries and plums are                 because the cross-price elasticity of demand is                 .

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