1. As the owner of an ice-cream store, you believe it is necessary to purchase another ice-cream maker to meet the increased demand. You need to take a loan to finance it. The loan officer tells you that your revenues of $750,000 are insufficient to support additional debt. To qualify for the loan, your revenues need to be $50,000 higher. To generate additional revenue, you collect data on the price (in cents) per pound you charge customers and the related quantity of ice-cream consumed per year in pounds. The information is saved in HW3_2.xlsx. Use these data to estimate the log-linear demand specification to obtain least squares estimated of the demand for ice-cream. Write an equation that summarizes the demand for ice cream, and then determine the percentage price increase or decrease that is needed in order to boost revenues by $50,000.

Question#6 Quantities PurchasedQuantities Purchased IncomePricesGood XGood Y $30,000Px = $6, Py = $3220 50,000Px = $6, Py = $4510       Refer to Table.Using the information in the table, calculate the income elasticity of demand for good X and characterize the good. Use the midpoint formula. Can you calculate the income elasticity of demand for good Y? If you can, show your calculation and characterize the good. If you cannot, explain why.

Imagine your income increases and you find that you buy more coffee. What is true about your income elasticity of demand (Ei) and how you perceive coffee?     Ei > 0 and you view coffee as an inferior good     Ei > 0 and you view coffee as a normal good     Ei < 0 and you view coffee as an inferior good     Ei < 0 and you view coffee as a normal good

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How does a sudden decrease in consumer confidence due to a significant political event impact the demand for luxury goods in an economy?

Elasticity: Measuring Responsiveness End of Chapter Problem You may have observed that items such as different brands of aspirin, tomato sauce, or gasoline are typically priced the same as each other. This is particularly true when consumers can find these goods in close proximity to each other. For example, prices are often the same at gas stations that are on opposite sides of the street. Prices are also generally the same for products next to each other on the same grocery store shelf. - The aforementioned examples are goods that are likely to be price elasticity to be You would expect the value of the cross- because the opportunity cost of getting information on price is low.

B. Calculate the price elasticity of demand for large drinks. (Show your work) Last month= $6.00 with 150 quantity This month= $5.50 with 161 quantity Elasticity of demand = Q2-Q1 161/150 divided by (Q1+02) 150+161=311 divided by 2 = 155.5

We can divide normal goods into two types: Those whose income elasticity is less than one and those whose income elasticity is greater than one. Think about products that would fall into each category-explain your reasoning for each categorization.

QUESTION 7 To mark national burger day there is a nationwide 50% sale on burgers during May. A recent survey, of those who bought burgers at supermarkets and food trucks, found that 99% of people will only eat burgers in a bun. Which of the following statements are true: The decrease in the price of burgers during May will cause a decrease in the quantity demanded of burgers. The decrease in the price of burgers in May will cause an increase in both demand and quantity demanded for buns. The decrease in the price of burgers in May will only result in an increase in the quantity demanded for buns. Economic theory is unable to predict if there would be any shift in demand for buns with the discount on burgers in May.

Consider two markets: the market for waffles and the market for pancakes. The initial equilibrium for both markets is the same, the equilibrium price is $6.50, and the equilibrium quantity is 35.0. When the price is $9.75, the quantity supplied of waffles is 57.0 and the quantity supplied of pancakes is 101.0. For simplicity of analysis, the demand for both goods is the same. Using the midpoint formula, calculate the elasticity of supply for pancakes. Please round to two decimal places. Supply in the market for waffles is