Demand and Supply and Elasticity


Question Description:

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Demand and Supply and Elasticity 1 answer below » Attached is my assignment that I need help with. There are four tabs, each with a couple problems on them. I need to be able to show my work/excel formulas on these problems in order to receive credit. Thanks for your help Document Preview: The demand curve is given by
where
I = consumer income, in thousands
a. Based on the demand curve above, is X a normal
or an inferior good?
b. Based on the demand curve above, what is the
relationship between good X and good Y?
c. Based on the demand View complete question » Attached is my assignment that I need help with. There are four tabs, each with a couple problems on them. I need to be able to show my work/excel formulas on these problems in order to receive credit. Thanks for your help Document Preview: The demand curve is given by
where
I = consumer income, in thousands
a. Based on the demand curve above, is X a normal
or an inferior good?
b. Based on the demand curve above, what is the
relationship between good X and good Y?
c. Based on the demand curve above, what is the
relationship between good X and good Z?
d. What is the equation of the demand curve if
consumer incomes are $30,000, the price of
good Y is $10, and the price of good Z is $20?
e. Graph the demand curve that you found in (d),
showing intercepts and slope.
f. If the price of good X is $15, what is the quantity
demanded? Show this point on your demand
curve.
g. Now suppose the price of good Y rises to $15.
Graph the new demand curve.
Q
D
= 500 – 5PX + 0.5I + 10PY – 2PZ
Q
D
= quantity demanded of good X
P
X
= price of good X
P
Y
= price of good Y
P
Z
= price of good Z
Suppose the demand and supply curves for a product
are given by
QD = 500 – 2P
QS = -100 + 3P
a. Graph the supply and demand curves.
b. Find the equilibrium price and quantity.
c. If the current price of the product is $100,
what is the quantity supplied and the quantity
demanded? How would you describe this situation,
and what would you expect to happen in
this market?
d. If the current price of the product is $150,
e. Suppose that demand changes to QD = 600 – 2P.
Find the new equilibrium price and quantity,
and show this on your graph.
For each of the following cases, calculate the arc
price elasticity of demand, and state whether demand
is elastic, inelastic, or unit elastic.
a. When the price of milk increases from $2.25 to
$2.50 per gallon, the quantity demanded falls
from 100 gallons to 90 gallons.
b. When the price of paperback books falls from
$7.00 to $6.50, the quantity demanded rises
from 100 to 150.
c. When the rent on apartments rises from $500
to $550, the quantity demanded decreases from
1,000 to 950.
For each of the following cases, what is the
expected impact on the total revenue of the firm?
Explain your… Attachments: Chapter-2-and….xlsx View less » Sep 17 2015 08:49 AM

Answer

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