MANAGERIAL ECON.+BUS.STRATEGY (LOOSE)
MANAGERIAL ECON.+BUS.STRATEGY (LOOSE)
9th Edition
ISBN: 9781259896422
Author: Baye
Publisher: MCG
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Chapter 3, Problem 4CACQ

Suppose the own price elasticity of demand for good X is -3, its income elasticity is 1, its advertising elasticity is 2, and the cross-price elasticity of demand between it and good Y is -4. Determine how much the consumption of this good will change if.

  1. The price of good X decreases by 5 percent.
  2. The price of good Y Increases by 8 percent.
  3. Advertising decreases by 4 percent.
  4. Income Increases by 4 percent

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