Which of the following elasticities can be generated by a Marshallian demand function 9a (Pa, Py, I) if the good a is inferior but not a giffen good and good r and good y are gross substitutes?
Which of the following elasticities can be generated by a Marshallian demand function 9a (Pa, Py, I) if the good a is inferior but not a giffen good and good r and good y are gross substitutes?
Chapter5: Elasticity Of Demand And Supply
Section: Chapter Questions
Problem 1.1P: (Calculating Price Elasticity of Demand) Suppose that 50 units of a good are demanded at a price of...
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Question
![Which of the following elasticities can be generated by a Marshallian demand function
ga (Pa, Py, I) if the good r is inferior but not a giffen good and good z and good y are
gross substitutes?
(a) er.p = -0.15,
(b) er.pr
-0.25,
=
(c) €x.pz
(d) er.p = 0.15,
(e) ezpz = -0.25,
=
= 0.5,
(a) -1
(b) -1/2
(c) 0
(d) 1/2
(e) 1
еx,py
ex.py
ex.py
= -0.33,
Crpy = 0.15,
ex.py
= 0.15,
erl= -0.15
-0.25, ex, I = -0.25
ex,1 = -0.17
Cr,l = 0.15
=
3
= 0.75,
ex,1 = -0.5
If an individual has the following utility function, U(x, y) = ln(x)+ln(y), then 2e1px +
er.pyer is equal to:](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fdc2a1dfc-3dbf-4a9c-9ebe-e5b225f660e8%2F3fd19ee1-a94d-496c-9038-2c4209a4d206%2Fuhhasgc_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Which of the following elasticities can be generated by a Marshallian demand function
ga (Pa, Py, I) if the good r is inferior but not a giffen good and good z and good y are
gross substitutes?
(a) er.p = -0.15,
(b) er.pr
-0.25,
=
(c) €x.pz
(d) er.p = 0.15,
(e) ezpz = -0.25,
=
= 0.5,
(a) -1
(b) -1/2
(c) 0
(d) 1/2
(e) 1
еx,py
ex.py
ex.py
= -0.33,
Crpy = 0.15,
ex.py
= 0.15,
erl= -0.15
-0.25, ex, I = -0.25
ex,1 = -0.17
Cr,l = 0.15
=
3
= 0.75,
ex,1 = -0.5
If an individual has the following utility function, U(x, y) = ln(x)+ln(y), then 2e1px +
er.pyer is equal to:
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