Ariya likes to play golf. The number of times per year that she plays depends on both the price of playing a round of golf as well as Ariya's income and the cost of other types of entertainment-in particular, how much it costs to go see a movie instead of playing golf. The three demand schedules in the table below show how many rounds of golf per year Ariya will demand at each price under three different scenarios. In scenario D1, Ariya's income is $80,000 per year and movies cost $15 each. In scenario D2, Ariya's income is also $80,000 per year, but the price of seeing a movie rises to $17. And in scenario D3, Ariya's income goes up to $100,000 per year, while movies cost $17. Scenario D1 D2 D3 Income per year $80,000 $80,000 $100,000 Price of movie ticket $15 $17 $17 Price of Golf Quantity Demanded $55 15 10 15 $40 25 15 30 $25 40 20 50 Instructions: Round your answers to two decimal places. If you are entering any negative numbers be sure to include a negative sign (-) in front of those numbers. a. Using the data under D1 and D2, calculate the cross elasticity of Ariya's demand for golf at all three prices. (To do this, apply the midpoints approach to the cross elasticity of demand.) At $55, cross elasticity =| At $40, cross elasticity = At $25, cross elasticity =
Ariya likes to play golf. The number of times per year that she plays depends on both the price of playing a round of golf as well as Ariya's income and the cost of other types of entertainment-in particular, how much it costs to go see a movie instead of playing golf. The three demand schedules in the table below show how many rounds of golf per year Ariya will demand at each price under three different scenarios. In scenario D1, Ariya's income is $80,000 per year and movies cost $15 each. In scenario D2, Ariya's income is also $80,000 per year, but the price of seeing a movie rises to $17. And in scenario D3, Ariya's income goes up to $100,000 per year, while movies cost $17. Scenario D1 D2 D3 Income per year $80,000 $80,000 $100,000 Price of movie ticket $15 $17 $17 Price of Golf Quantity Demanded $55 15 10 15 $40 25 15 30 $25 40 20 50 Instructions: Round your answers to two decimal places. If you are entering any negative numbers be sure to include a negative sign (-) in front of those numbers. a. Using the data under D1 and D2, calculate the cross elasticity of Ariya's demand for golf at all three prices. (To do this, apply the midpoints approach to the cross elasticity of demand.) At $55, cross elasticity =| At $40, cross elasticity = At $25, cross elasticity =
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Transcribed Image Text:Ariya likes to play golf. The number of times per year that she plays depends on both the price of playing a round of golf as well as
Ariya's income and the cost of other types of entertainment-in particular, how much it costs to go see a movie instead of playing golf.
The three demand schedules in the table below show how many rounds of golf per year Ariya will demand at each price under three
different scenarios. In scenario D1, Ariya's income is $80,0o00 per year and movies cost $15 each. In scenario D2, Ariya's income is also
$80,000 per year, but the price of seeing a movie rises to $17. And in scenario D3, Ariya's income goes up to $100,000 per year, while
movies cost $17.
Scenario
D1
D2
D3
Income per year
$80,000
$80.000
$100,000
Price of movie ticket
$15
$17
$17
Price of Golf
Quantity Demanded
$55
15
10
15
$40
25
15
30
$25
40
20
50
Instructions: Round your answers to two decimal places. If you are entering any negative numbers be sure to include a negative sign
(-) in front of those numbers.
a. Using the data under D1 and D2, calculate the cross elasticity of Ariya's demand for golf at all three prices. (To do this, apply the
midpoints approach to the cross elasticity of demand.)
At $55, cross elasticity =
At $40, cross elasticity =
At $25, cross elasticity =
00
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education