1. Suppose the price of peanut butter rises from $2 to $4 per jar. Instructions: Round your answer to four decimal places and include a negative sign if appropriate. a. The quantity of jelly purchased decrease from 20 million jars to 15 million jars. Find the cross- price elasticity of demand between peanut butter and jelly using the mid-point method. b. Are the goods are complimentary or substitutes? c. The quantity of jelly purchased rises from 15 million jars to 20 million jars. Find the cross-price elasticity of demand between peanut butter and jelly using the mid-point method. d. Are the goods complimentary or substitutes?

1. Suppose the price of peanut butter rises from $2 to $4 per jar. Instructions: Round your answer to four decimal places and include a negative sign if appropriate. a. The quantity of jelly purchased decrease from 20 million jars to 15 million jars. Find the cross- price elasticity of demand between peanut butter and jelly using the mid-point method. b. Are the goods are complimentary or substitutes? c. The quantity of jelly purchased rises from 15 million jars to 20 million jars. Find the cross-price elasticity of demand between peanut butter and jelly using the mid-point method. d. Are the goods complimentary or substitutes?

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter5: Elastic And Its Application

Section: Chapter Questions

Problem 6PA: Suppose that your demand schedule for DVDs is as follows: Price Quantity Demanded (income = 10,000)...

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Question

1. Suppose the price of peanut butter rises from
$2 to $4 per jar.
Instructions: Round your answer to four decimal
places and include a negative sign if appropriate.
a. The quantity of jelly purchased decrease from
20 million jars to 15 million jars. Find the cross-
price elasticity of demand between peanut butter
and jelly using the mid-point method.
b. Are the goods are complimentary or
substitutes?
c. The quantity of jelly purchased rises from 15
million jars to 20 million jars. Find the cross-price
elasticity of demand between peanut butter and
jelly using the mid-point method.
d. Are the goods complimentary or substitutes?

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