Luchansky and Monks (2009) estimate that the U.S. demand curve for ethanol is Qequals=p Superscript negative 0.504 Baseline p Subscript g Superscript 1.269 Baseline v Superscript 2.226p−0.504p1.269gv2.226, where Q is the quantity of ethanol, p is the price of ethanol, p Subscript gpg is the price of gasoline, and v is the number of registered vehicles. What is the elasticity of demand for ethanol? Part 2 The elasticity of demand is the percentage change in quantity divided by the percentage change in price:

Luchansky and Monks (2009) estimate that the U.S. demand curve for ethanol is Qequals=p Superscript negative 0.504 Baseline p Subscript g Superscript 1.269 Baseline v Superscript 2.226p−0.504p1.269gv2.226, where Q is the quantity of ethanol, p is the price of ethanol, p Subscript gpg is the price of gasoline, and v is the number of registered vehicles. What is the elasticity of demand for ethanol? Part 2 The elasticity of demand is the percentage change in quantity divided by the percentage change in price:

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 23SQ: If automobiles and gasoline are complements, then their cross-elasticity coefficient is a. strictly...

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