Price of good x (RM) Quantity demanded for good x (Units) Quantity demanded for good Y (Units) Quantity demanded for good Z (Units) 1 100 1,000 10 50 500 20 3 25 250 40 4 20 200 80 5 18 180 180 a) Suppose the price of good x increase from RM3 per unit to RM4 per unit, calculate and explain: i) ii) ii) Price elasticity of demand for good x. Cross elasticity of demand for good Y with respect to good X. Cross elasticity of demand for good Z with respect to good X.

Price of good x (RM) Quantity demanded for good x (Units) Quantity demanded for good Y (Units) Quantity demanded for good Z (Units) 1 100 1,000 10 50 500 20 3 25 250 40 4 20 200 80 5 18 180 180 a) Suppose the price of good x increase from RM3 per unit to RM4 per unit, calculate and explain: i) ii) ii) Price elasticity of demand for good x. Cross elasticity of demand for good Y with respect to good X. Cross elasticity of demand for good Z with respect to good X.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Two goods have a cross-price elasticity of demand of 1.2: Would you describe the nature of goods? If the price of one good increase by 5 percent, what will happen to the demand for the other good. Also estimates its value holding other factors constant?
Microeconomics homework question
Price of good x (RM) Quantity demanded for good x (Units) Quantity demanded for good Y (Units) Quantity demanded for good Z (Units) 1 100 1,000 10 50 500 20 25 250 40 4 20 200 80 5 18 180 180 a) What is the relationship between: i) ii) Goods X and Y? Goods X and Z? b) If you are the producer of good x and you want to increases your total revenue would you increase the price of RM3 per unit to RM4 per unit? Why? (use the concepts of elasticity in your answer)?
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Q1: What is price elasticity of demand? Q2: What are degrees of price elasticity of demand?
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