Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![Elasticity and Its Applications FRED
Discovering Data
1.400
Let's compare expenditures on cell
phones with the price of phones.
Unfortunately, as is often the case,
it's difficult to find the exact data we
want, but we can use a data series
that should closely correlate with cell
phone prices.
The accompanying graph depicts the
level of expenditure on telephone and
facsimile equipment (faxes maybe
you have heard of them?) and the
price level (the one with price index
in its name) for telephone and
facsimile equipment. Both series use
an index that sets the price and
expenditure levels in 2009 to 100.
Index, Index 2012-100
1,200
1.000
800
600
400
200
0
2000
2005
2010
1950
Source: U.S. Bureau of Economic Analysis
2015
2009
Customize | Download Data | FRED Economic Data from the St. Louis Fed
2020](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F9f77992d-cf68-4716-89b0-de6cba88e094%2F55e32fc2-b4fb-421e-b3c6-8850d8b8db62%2Fa0pha4l_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Elasticity and Its Applications FRED
Discovering Data
1.400
Let's compare expenditures on cell
phones with the price of phones.
Unfortunately, as is often the case,
it's difficult to find the exact data we
want, but we can use a data series
that should closely correlate with cell
phone prices.
The accompanying graph depicts the
level of expenditure on telephone and
facsimile equipment (faxes maybe
you have heard of them?) and the
price level (the one with price index
in its name) for telephone and
facsimile equipment. Both series use
an index that sets the price and
expenditure levels in 2009 to 100.
Index, Index 2012-100
1,200
1.000
800
600
400
200
0
2000
2005
2010
1950
Source: U.S. Bureau of Economic Analysis
2015
2009
Customize | Download Data | FRED Economic Data from the St. Louis Fed
2020
![The demand for telephones is
O unit elastic.
relatively elastic.
O relatively inelastic.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F9f77992d-cf68-4716-89b0-de6cba88e094%2F55e32fc2-b4fb-421e-b3c6-8850d8b8db62%2Fqrcn9as_processed.jpeg&w=3840&q=75)
Transcribed Image Text:The demand for telephones is
O unit elastic.
relatively elastic.
O relatively inelastic.
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