For the following three cases, use a midpoints formula to calculate the coefficient for the cross elasticity of demand and identify the type of relationship between the two products. (a) The quantity demanded for product A increases from 30 to 40 as the price of product B increases from $0.10 to $0.20. Elasticity: ______ Relationship: ________________ (b) The quantity demanded for product A decreases from 3000 to 1500 as the price of good B increases from $5 to $10. Elasticity: ______ Relationship: ________________ (c) The quantity demanded for product A remains 400 units as the price of product B increases from $25 to $30. Elasticity:
For the following three cases, use a midpoints formula to calculate the coefficient for the cross elasticity of demand and identify the type of relationship between the two products. (a) The quantity demanded for product A increases from 30 to 40 as the price of product B increases from $0.10 to $0.20. Elasticity: ______ Relationship: ________________ (b) The quantity demanded for product A decreases from 3000 to 1500 as the price of good B increases from $5 to $10. Elasticity: ______ Relationship: ________________ (c) The quantity demanded for product A remains 400 units as the price of product B increases from $25 to $30. Elasticity:
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter5: Price Elasticity Of Demand And Supply
Section: Chapter Questions
Problem 16SQ
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For the following three cases, use a midpoints formula to calculate the coefficient for the cross elasticity of demand and identify the type of relationship between the two products.
-
(a) The quantity demanded for product A increases from 30 to 40 as the price of product B increases from $0.10 to $0.20.
Elasticity: ______ Relationship: ________________
-
(b) The quantity demanded for product A decreases from 3000 to 1500 as the price of good B increases from $5 to
$10.
Elasticity: ______ Relationship: ________________ -
(c) The quantity demanded for product A remains 400 units as the price of product B increases from $25 to $30. Elasticity: ______ Relationship: ________________
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