Modern Principles: Microeconomics
4th Edition
ISBN: 9781319098766
Author: Tyler Cowen, Alex Tabarrok
Publisher: Worth Publishers
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Question
Chapter 5, Problem 1FT
Subpart (a):
To determine
The price inelasticity of demand.
Subpart (a):
Expert Solution
Explanation of Solution
Fruit is more likely to be in-elastically demanding. This is because fruit as a whole has fewer substitutes than any other item in the category of the fruits.
Economics Concept Introduction
Concept Introduction:
Subpart (b):
To determine
The price inelasticity of demand .
Subpart (b):
Expert Solution
Explanation of Solution
Since the people are relatively inelastic or inflexible in a short run, demand for beef over the next month is more inelastic.
Subpart (c):
To determine
The price inelasticity of demand.
Subpart (c):
Expert Solution
Explanation of Solution
The demand for the gasoline in the entire city is more in-elastically demanding. This is because branded goods are more elastic than other categories. This implies very good substitutes for Exxon gasoline, which may be available at close distances whereas fewer substitutes may be available for the category of gasoline.
Subpart (d):
To determine
The price inelasticity of demand.
Subpart (d):
Expert Solution
Explanation of Solution
Insulin is more a necessity good for the buyers of insulin. This implies the demand for insulin from buyers is more inelastic than the demand for vitamins for the buyers of vitamins.
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Chapter 5 Solutions
Modern Principles: Microeconomics
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