Microeconomics
2nd Edition
ISBN: 9781259813337
Author: KARLAN, Dean S., Morduch, Jonathan
Publisher: Mcgraw-hill Education,
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Question
Chapter C, Problem 2PA
To determine
(a)
To calculate:
The percentage change in price from $4.50 to $5.50 using the mid-point method.
To determine
(b)
To calculate:
The percentage change in price from $750 to $500 using the mid-point method.
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You have just opened a new grocery store. Every item you carry is generic (generic beer, generic bread, generic chicken, etc.). You recently read an article in the Wall Street Journal reporting that the price of recreation is expected to increase by 15 percent. How will this affect your store’s sales of generic food products?
GrubHub, a food delivery service, has recently expanded to your area. The accompanying table contains the number of deliveries per month that you demand at various delivery prices. Use this information to plot (draw) your individual demand curve. Describe the slope of your individual demand curve.
Price
Deliveries
$10
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$7
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$4
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$2
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The effect of a decrease in the price of food, as depicted
in the figure, leads us to believe that:
A) food is a Giffen good and clothing an inferior good.
B) food is a Giffen good and clothing a normal good.
C) food is a normal good and clothing a Giffen good.
D) food is an inferior good and clothing a Giffen good.
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