7. Consider the following demand function for 'X-caliber beer. Qx 100 - 5PX -.5I where Px is the price of a 6 pack of the product and I is the annual income (in '000's of dollars). If Px = $6.00 and I = $20, which of the following can you conclude? = a. Profits would rise if the price was increased. X-caliber beer is a cyclical good. b. c. Total revenues would fall if price was increased. d. X-caliber beer is a normal good.

7. Consider the following demand function for 'X-caliber beer. Qx 100 - 5PX -.5I where Px is the price of a 6 pack of the product and I is the annual income (in '000's of dollars). If Px = $6.00 and I = $20, which of the following can you conclude? = a. Profits would rise if the price was increased. X-caliber beer is a cyclical good. b. c. Total revenues would fall if price was increased. d. X-caliber beer is a normal good.

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 10PA

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