4. Suppose the demand for apple (good x) can be expressed as x = (21-12)/px, where I is the consumer's income, measured in hundreds of thousands of dollars. (a) Calculate the income elasticity for apple. (b) Provide and interpretation for the income elasticity for apple. For what values of I is apple a normal good? 5. Suppose the demand for good x was x = √{9 — (1-3)² } - Px (a) Calculate the income elasticity for good x. (b) Derive and plot the Engel curve for good x. (c) For what income levels is good x a normal good? Label this range on your plot in part (b).
4. Suppose the demand for apple (good x) can be expressed as x = (21-12)/px, where I is the consumer's income, measured in hundreds of thousands of dollars. (a) Calculate the income elasticity for apple. (b) Provide and interpretation for the income elasticity for apple. For what values of I is apple a normal good? 5. Suppose the demand for good x was x = √{9 — (1-3)² } - Px (a) Calculate the income elasticity for good x. (b) Derive and plot the Engel curve for good x. (c) For what income levels is good x a normal good? Label this range on your plot in part (b).
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 17SQ: Suppose Sally buys exactly five bars of English toffee each week, regardless of whether the toffee...
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Transcribed Image Text:4. Suppose the demand for apple (good x) can be expressed as x = (21-12)/px, where I is the
consumer's income, measured in hundreds of thousands of dollars.
(a) Calculate the income elasticity for apple.
(b) Provide and interpretation for the income elasticity for apple. For what values of I is apple a
normal good?
5. Suppose the demand for good x was x = √{9 — (1-3)² }
-
Px
(a) Calculate the income elasticity for good x.
(b) Derive and plot the Engel curve for good x.
(c) For what income levels is good x a normal good? Label this range on your plot in part (b).
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