Suppose the demand for commodity X is estimated as follows: X=68-1.6Px + 0.6Py + 0.08M Where: X=quantity of commodity X Px=N20 is the price of X Py= N40 is the price of Y M=N1000 is the income of the consumer Calculate: A. The price elasticity of X B. The cross-price elasticity of demand for X with respect to the change in the price of Y C The income elasticity of demand X .Also interpret your result is in 1,2,
Suppose the demand for commodity X is estimated as follows: X=68-1.6Px + 0.6Py + 0.08M Where: X=quantity of commodity X Px=N20 is the price of X Py= N40 is the price of Y M=N1000 is the income of the consumer Calculate: A. The price elasticity of X B. The cross-price elasticity of demand for X with respect to the change in the price of Y C The income elasticity of demand X .Also interpret your result is in 1,2,
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter5: Elastic And Its Application
Section: Chapter Questions
Problem 7PA: Suppose that your demand schedule for pizza is as follows: a. Use the midpoint method to calculate...
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Suppose the
X=68-1.6Px + 0.6Py + 0.08M
Where:
X=quantity of commodity X
Px=N20 is the price of X
Py= N40 is the price of Y
M=N1000 is the income of the consumer
Calculate:
A. The price elasticity of X
B. The cross-price
C The income elasticity of demand X .Also interpret your result is in 1,2, and 3
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