In this question, you'll deal with two goods, and you'll have to solve for cross-price elasticity using the percent change formula. When the old price of a file cabinet was $1,039 per cabinet, an old quantity of 228 desks were sold. After the price decreased to a new price of $854 per file cabinet, a new quantity of 381 desks were sold. Using these numbers, what is the cross-price elasticity of file cabinets for desks? Round your answer to 3 decimal places.

Suppose that the demand for sweatshirts at the university bookstore is given by: P = 40 – 0.2Q A) Using the point elasticity method, price elasticity of demand at a price of $8 is  B) Is the demand for sweatshirts elastic or inelastic at the price of $8?

At Webs-R-Us, a website design company, the new manager has decided to increase the price of Webs-R-Us services by 45%. She estimates that the price elasticity of demand for Webs-R-Us is −0.70. The manager expects the number of websites designed to decrease by?

Using data on automobile purchases, P. McCarty (REStat 1996) estimated the following elasticities for compact cars sold in the United States. Own elasticity of demand Income Elasticity Cross Price* - 0.87 1.70 .82 * Responsiveness of demand for compact cars to changes in the price of other types of car models, such as luxury cars. а) What is the percent change in quantity demanded for compact cars given a 2 percent decrease in the price of compact cars? b) What is the percent change in demand for compact cars given a 2 percent decrease in the price of other car models? c) What is the percent change in demand for compact cars given a 2 percent decrease in income? d) Is demand for compact cars elastic or inelastic? Explain briefly. e) Would a decrease in the price of compact cars generate more or less revenue from the sale of compact cars? f) Are compact cars a normal or inferior good? Explain briefly. 5.

Melanie really enjoys using her old-school charcoal grill to cook steaks, but she has found that due to environmental regulations, charcoal prices have gone up 50%. What is her price elasticity of demand for the rest of this month going to be compared to what it will be in the spring? Please explain why.

Using the midpoint method, your price elasticity of demand as the price of pizzas increases from $14 to $16 is____ if your income is $20,000 and___ if your income is $24,000. If the price of a pizza is $12, your income elasticity of demand is_____ as your income increases from $20,000 to $24,000. However, if the price of a pizza is $16, your income elasticity is______ .

Congratulations! You have just landed your first job out of college as an economic analyst at the Bureau of Labor Statistics. Your starting salary is $55,000 per year; an increase of 250% per year over the salary you made at the local coffee shop. The corresponding table gives the percentage change in your purchases of each good after your income increases. Use this information to estimate your income elasticity of demand for each of the items.

If the price of new automobiles decreases by 5%, and the quantity of new automobiles demanded increases by 20%, then the price elasticity of demand is equal to: 1.1. 2. 0.25. 3.4. 4.0.75.

Each scenario gives some information about price elasticity of demand. For each, calculate the missing data, and determine if the price change under consideration will increase, decrease, or not change the firm's total revenue. Honest Abe's Used Cars estimates the price elasticity of demand for their cars to be -4.1. Last month, Abe tried a new marketing scheme which decreased the number of cars sold by 87%. Abe must have his prices by -27.87 Abe's total revenue by increased and total revenue to increased. At Webs-R-Us, a website design company, the new manager has decided to increase the price of Webs-R-Us services by 15%. She estimates that Webs-R-Us has a price elasticity of demand at -0.30. The manager expects the number of websites designed to decrease increase. %. e %

How to calculate price elasticities for demand for rice and coffee at P=6, respectively.   (1) P=12-2Q for coffee (2) P=12-3Q for rice