The cross-price elasticity of demand for rice relative to potatoes is 0.4. Select one or more: a. This implies that rice and potatoes are complements b. This implies that potatoes are a normal good c. This implies that rice is an inferior good d. This implies that rice and potatoes are substitute goods

The cross-price elasticity of demand for rice relative to potatoes is 0.4. Select one or more: a. This implies that rice and potatoes are complements b. This implies that potatoes are a normal good c. This implies that rice is an inferior good d. This implies that rice and potatoes are substitute goods

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter5: Elastic And Its Application

Section: Chapter Questions

Problem 5CQQ: An increase in the supply of a good will decrease the total revenue producers receive if a. the...

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Question

Please explain which choices arre correct in these 2 multiple choice questions

Thank you and Happy New Year

The cross-price elasticity of demand for rice relative to potatoes is
0.4.
Select one or more:
a. This implies that rice and potatoes are complements
b. This implies that potatoes are a normal good
c. This implies that rice is an inferior good
d. This implies that rice and potatoes are substitute goods
In a competitive market with free entry and exit from the market a
permanent rise in demand will lead to
Select one or more:
a. normal profits being made in the long-run
b. excess profits being made in the short run (before new firms
can enter)
c. a permanent rise in prices
d. entry by new firms

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