Use the following demand function to answer questions 3-4. Show all your work to receive fullcredit.Qpork= 5.2 – 1.47Ppork + 1.82Peef + 0.18Pchicken + 0.38/Calculate the cross-price elasticity of pork demand with respect to beef if the priceof pork is $3.78/lb., the price of beef is $6.15/1b., the price of chicken is $1.90/lb., disposableincome is $48000 per capita, and the total quantity demanded of pork is 52 lbs. per capita.If the price of beef increases by 12%, how much would you expect the quantitydemanded of pork to change (in lbs.)?

Cross price elasticity measures the responsiveness in demand of a good due to change in price of a…

Answered: Opork= 5.2 – 1.47P,r Ppork + 1.82Pr0of…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The following table contains a monthly demand and supply schedule for large, single- topping, carry-out pizza Pizza Price (per pack) Quantity demanded for pizza (per pack) Quantity supplied for pizza (per pack) Quantity demanded for good Y $21 6000 7900 6000 $19 7000 7200 8000 $17 8000 6500 10000 (A) Calculate the price elasticity Of demand (PED) for good X when price fall from S 19 to $ 17. (B) Suppose you are the sellers of pizza based on the value of PED obtained In your answer for Question(A), would you or would you not raise the price of pizza? Why? (C)What S the cross elasbcity of demand (CED) of Good Y when price of carry-out pizza fall from $19 to S17? How is pizza and the Good Y related?
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Price of Erasers Quantity Demanded of Erasers Quantity Demanded of Pencils 0.90 1.40 -1.94 30 19 Using the above information and the midpoint method, what's the cross price elasticity between pencils and erasers when the price of erasers change from $0.90 to $1.40? (Hint: enter your answers in 2 decimals) Your Answer: Answer 21 19
Your firm receives revenue of $40MM per year from Product A and $90MM per year from Product B. The own- price elasticity of demand for Product A is -1.5. The cross-price elasticity of demand between Product A and Product B is -1.8. Suppose you increase the price of Product A by two percent: a. How much will Product A’s revenue change? b. How much will Product B’s revenue change?
Consider the cross-price elasticities of demand for four pairs of goods: For goods A & B, the cross-price elasticity of demand is -2.0 For goods C & D, the cross-price elasticity of demand is -0.5 For goods E & F, the cross-price elasticity of demand is 1.5 For goods G & H, the cross-price elasticity of demand is 0.2 Which pair of goods are close (strong) substitutes? A&B C&D E&F G&H
In a particular market, demand and supply curves are defined by the following equations: P=50 – 0.5QD QS= -20 + 2P where, P is the price in pounds, QS is the quantity supplied and QD is the quantity demanded. 1. What is the equilibrium price and quantity? 2. What is the price elasticity at a price of £35? 3. What do you expect will happen to total expenditure on this good if the price increases from £35 to £40? Is this expectation confirmed if you calculate the total revenue for each price?
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Calculate the price elasticity of demand when the price of pencils rises from $4.50 to $5.50, when income is $20,000.
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Suppose the own-price elasticity of demand for beef is -0.8 and the own-price elasticity of supply of beef is 0.9. Due to a newly introduced government policy, beef supply increases by 2% with no change in the demand for beef. Assuming that the current price for beef is 40/cwt and the quantity bought and sold is 2,000 cwt per day, find the new equilibrium price and quantity of beef (round your answers to two decimal places).

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