Suppose the demand function for a firm’s product is given by Where Px=P10, Py=P4, M=P20,000, and A=P250. [a] determine the own price elasticity of demand, and state whether demand is elastic, inelastic, or unitary elastic. [b] Determine the cross-price elasticity of demand between good X and good Y, and state whether these two goods are substitutes or complements. [c] Determine the income elasticity of demand, and state whether good X is a normal or inferior good. [d] Determine the own advertising elasticity of demand.
1. Suppose the demand function for a firm’s product is given by Where Px=P10, Py=P4, M=P20,000, and A=P250. [a] determine the own price elasticity of demand, and state whether demand is elastic, inelastic, or unitary elastic. [b] Determine the cross-price elasticity of demand between good X and good Y, and state whether these two goods are substitutes or complements. [c] Determine the income elasticity of demand, and state whether good X is a normal or inferior good. [d] Determine the own advertising elasticity of demand.
Answer:
A) Own price elasticity demand = -0.5, =/-0.5/=0.5 elastic
B) =-2.5, =-2.5 between X&Y, CPE is (-) X&Y are compliment
C) since IE is (+) X is normal good.
D) Since the function for advertising elasticity is , the
Explanation:
2. what are the relying factors of demand elasticity?
Answer:
Many factors determine the demand elasticity for a product, including price levels, the type of product or service, income levels, and the availability of any potential substitutes. High-priced products often are highly elastic because, if prices fall, consumers are likely to buy at a lower price.
3. A linear demand function exhibits: a) constant demand elasticity. b) more elastic demand as output increases. c) less elastic demand as output increases. d) insufficient information to determine.
Answer:
c) less elastic demand as output increases.
Explanation:
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4. Define all of the Key Terms .Arc Elasticity Complementary GoodCross -Price Elasticity of DemandElasticityIncome Elasticity of DemandInferior GoodLuxury GoodNecessity GoodNormal GoodPoint ElasticityPrice Elasticity of DemandPrice Elasticity of SupplySubstitute Good
1. Arc Elasticity - It refers to the elasticity of demand or supply calculated over an arc or range of price and quantity instead of at a specific point.
2. Complementary Good - A complementary good is a product that is used together with another product. An increase in the price of one good leads to a decrease in the quantity demanded for both goods.
3. Cross-Price Elasticity of Demand - It is the measure of the responsiveness of the demand for one good when the price of another good changes. It can be positive or negative.
4. Elasticity - It is a measure of the responsiveness of one variable to changes in another variable.
5. Income Elasticity of Demand - It is the measure of the responsiveness of demand for a good or service to a change in income. It can be positive or negative.
6. Inferior Good - It is a good for which demand decreases when the income level of its consumers increases.
7. Luxury Good - A luxury good is a good for which demand increases more than proportionally to an increase in income.
8. Necessity Good - It is a good for which demand remains constant as income changes.
9. Normal Good - A normal good is a good for which demand increases when the income level of its consumers increases.
10. Point Elasticity - It is the measure of elasticity at a specific point on a demand or supply curve.
11. Price Elasticity of Demand - It is the measure of the responsiveness of the quantity demanded of a good or service to changes in the price of the same good or service.
12. Price Elasticity of Supply - It is the measure of how much the quantity supplied of a good or service changes in response to a change in price.
13. Substitute Good - A substitute good is a product that can be used as an alternative to another product. An increase in the price of one good increases the quantity demanded for the substitute good.
5. In computing price elasticity of demand, how can we determine if it is elastic, inelastic or unitary?
Answer:
If the change in quantity purchased is the same as the price change (say, 10%/10% = 1), the product is said to have unit (or unitary) price elasticity. Finally, if the quantity purchased changes less than the price (say, -5% demanded for a +10% change in price), then the product is termed
Explanation:
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6. to determine wether two goods are subtitutes or complements, an economist would estimate the select one:a. cross-elasticity of demandb. income elasticity of demandc. price elasticity of supplyd. price elasticity of demand.
Answer:
a. cross-elasticity of demand
7. The quantity demanded of good X rises from 130 to 145 units as income rises from $2000 to $2500 a month. What is the income elasticity of demand? Is good X a normal good or inferior good? Determine the type of elasticity.
Answer:
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Explanation:
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8. do you agree that through the determination of price elasticity, policy makes can determine - if the demand is inelastic the larger part of the indirect tax can be shifted upon buyers by increasing price? on the other hand, if the demand is elastic than the burden of tax will be more on the producer. explain briefly.
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9. . How important is elasticity in the analysis of the market? 2. What factors affect elasticity of demand?
Answer:
1.Elasticity is an important economic measure, particularly for the sellers of goods or services, because it indicates how much of a good or service buyers consume when the price changes. ... If the market price goes up, firms are likely to increase the number of goods they are willing to sell.
2.The four factors that affect price elasticity of demand are (1) availability of substitutes, (2) if the good is a luxury or a necessity, (3) the proportion of income spent on the good, and (4) how much time has elapsed since the time the price changed. If income elasticity is positive, the good is normal.
Explanation:
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10. B. Identify the correct term that each statements describes or defines. 1.______________ is the measure of responsiveness to particular force. 2.______________ elasticity tells you about a particular product and how responsive it is in the case of demand, the demand in the change of price. 3. ______________ tells about the relationship between the product that we have and another product. 4. ______________ when there is increase in salary of the people tends to buy products which are important. 5. ______________ it is price elasticity of demand on the perspective of suppliers. 6. ______________ are the factors that affects the price elasticity of demand. 7. ______________ when price elasticity of demand is equal to zero. 8.______________ when price elasticity of demand is equal to infinity. 9. ______________ when price elasticity of demand is greater than one. 10. _____________ when price elasticity of demand is less than one.NEED KO MAAYOS NA SAGOT
Answer:
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ElasticityPriceBrandBottom LinePrice Elasticity of Demand(1) Availability of substitutes, (2) if the good is a luxury or a necessity, (3) the proportion of income spent on the good, and (4) how much time has elapsed since the time the price changed.Perfectly Inelastic DemandPerfectly ElasticDeemed ElasticInelasticps* I'm not sure on no.s 3,4&6
11. 1. % increase in price- 12% % decrease in demand-18% % increase in supply- 15% what is the elasticity in demand and supply and determine the type or kind of elasticity?
Answer:
Price elasticity of supply measures the percentage change in the quantity supplied producers divided by percentage change in the price of the product
12. Given the demand schedule below, determine the elasticity in the different situations. Show your solution: (3 points each – 1 point for the solution, 1 point for the elasticity coefficient and 1 point for the elasticity)
Explanation:
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13. 4. The coefficient of demand relates a percentage change in quantity demanded of Good A in response to a percentage change in the price of Good B. y a. Price elasticity of demand b. cross elasticity of demand c. income elasticity of demand d. Cross elasticity of supply
4. The coefficient of demand relates a percentage change in quantity demanded of Good A in response to a percentage change in the price of Good B. y
a. Price elasticity of demand
b. cross elasticity of demandc. income elasticity of demand
d. Cross elasticity of supply
14. if a good is inferior thenA.all the encome . the income elasticity of demand will be negative.B. the income elasticity of demand will be zero.C. the income elasticity of demand will be positive.D. a decrease in income will cause demand to decrease.
The answer is "A. the income elasticity of demand will be negative."If a good is inferior then, the income elasticity of demand will be negative.
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15. elasticity of demand refers to the change in demand when there is change in another factor such as price or income
Answer:
Elasticity of demand refers to the change in demand when there is a change in another factor, such as price or income. If demand for a good or service is static even when the price changes, demand is said to be inelastic. Examples of elastic goods include luxury items and certain food and beverages.
16. what factors affect elasticity of demand?
Answer:
Some factors that affect the elasticity of demand are: income of the buyers, the kind of good being sold, availability of substitutes, and price.
17. If the price elasticity of demand for a good is 0.5, what does that mean? A. Demand is elastic B. Demand is inelastic C. Demand is unit elastic
B. Since the change in demand is smaller than the change in price, we can conclude that demand is relatively inelastic1.
18. 2. If the price elasticity of demand has a coefficient of 1.80, then A. demand is elasticB demand is inelasticC. demand is perfectly elastic D. demand is perfectly inelastic
Answer:
D.
Explanation:
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Answer:
D..
Explanation:
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19. what is the determinants of price elasticity of demand
- Many factors determine the demand elasticity for a product, including price levels, the type of product or service, income levels, and the availability of any potential substitutes. High-priced products often are highly elastic because, if prices fall, consumers are likely to buy at a lower price.
Answer:
Many factors determine the demand elasticity for a product, including price levels, the type of product or service, income levels, and the availability of any potential substitutes. High-priced products often are highly elastic because, if prices fall, consumers are likely to buy at a lower price.
Explanation:
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20. 2. %increase in price-20% %decrease in demand-15% % increase in supply-25% What is the elasticity of demand and supply and determine the type of elasticity?
Answer:
unit elastic po
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21. for g-12 9. It shows the relationship between demand for a commodity and the factors that determine or influence this demand. a. demand b. demand function c. demand curve d. demand schedule 10. The government's specification with minimum or maximum current price of a particular good or service that disadvantageous to the producer or consumer. a. price ceiling b. price control d. surplus TI c. price floor . 11. The responsiveness of demand supply to a change in its determinants. a.Arc Elasticity b. Elasticity c. Point Elasticity d. Price Elasticity 12. At a given price, quantity demanded can change infinitely. The demand is a.elastic b. Inelastic c. Perfectly Elastic d. Perfectly Inelastic 13. The price elasticity of demand measures: a. The degree of responsiveness of quantity supplied to variation in price. b. The degree of responsiveness of quantity demanded to variations in price. c. The price of the commodity at which buyers are willing to buy. d. The number of goods that buyers are willing to buy. 14. The price of elasticity of supply measures: a. The degree of responsiveness of quantity supplied to variation in price. b. The degree of responsiveness of quantity demanded to variation in price. c. The price of the commodity at which buyers are willing to buy d. The number of goods that buyers are willing to buy.
Answer:
9.b
10.b
11.d
12.a
13.b
14.b
Explanation:
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22. can someone give me examples of Perfectly inelastic demand, Unitary elastic demand ,and perfectly elastic demand?
Answer:
Examples of perfectly elastic products are luxury products such as jewels, gold, and high-end cars
Explanation:
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23. What elasticity of demand would be exhibited in a situation wherw a nation is suddenly struck by an economic crisis, affecting the jobs of everyone?a. income elasticity of demandb. cross price elasticity of demandc. price elasticity of demandd. all of the above
Answer:
d
Explanation:
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24. 1. The degree of change in demand or supply due to the change in its determinants a. Inelastic b. Elasticity c. Cross elasticity d. Price elasticity i 2. The main determinants of supply and demand a. Technology b. Income c. Price d. Quantity 3. The elasticity coefficient of 0.7 means a. Elastic b. Inelastic c. Perfectly elastic d. Perfectly inelastic
Answer:
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25. anong topic ang mga eto? (simplified): -Utility Theory. -Factors affecting demand. -Elasticity of Demand.
Answer:
supply and demand
Explanation:
26. ) If the price of the laser eye surgery falls by 50% and the quantity of contact lenses demanded falls by 25%, find the cross elasticity of demand for these two goods. Show your complete solution. Determine the type of cross elasticity
Answer:
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27. Cite one consumer product that your family regularly buys and discuss its price elasticity of demand based on your experience and observation. What are the factors that influence the product's price elasticity of demand?
Answer:
Body soap,its price elasticity did'nt raised that much since it has a high demand on the ongoing pandemic
Explanation:
the factors that affect the product's price are the economic status,nature of commodity,availability of substitutes,Income Level,Level of price,Postponement of Consumption,Number of Uses and many more.
28. - How can you determine whether the demand for a good is elastic or inelastic?
Answer:
An inelastic demand is one in which the change in quantity demanded due to a change in price is small. If the formula creates an absolute value greater than 1, the demand is elastic. In other words, quantity changes faster than price. If the value is less than 1, demand is inelastic
Explanation:
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29. Anong topic ang mga eto? -Utility Theory. -Factors affecting demand. -Elasticity of Demand.
Answer:
Utility Theory- ibinabatay ang mga paniniwala nito sa mga kagustuhan ng mga indibidwal. Ito ay isang teorya na nai-postulate sa ekonomiya upang ipaliwanag ang pag-uugali ng mga indibidwal batay sa premise na ang mga tao ay maaaring patuloy na mag-ranggo ng pagkakasunud-sunod ng kanilang mga pagpipilian depende sa kanilang mga kagustuhan.
Factors affecting demand- The demand for a good increases or decreases depending on several factors. This includes the product's price, perceived quality, advertising spend, consumer income, consumer confidence, and changes in taste and fashion.
Elasticity of Demand- A good's price elasticity of demand is a measure of how sensitive the quantity demanded is to its price. When the price rises, quantity demanded falls for almost any good, but it falls more for some than for others.
30. the elasticity is greater than 1, is demand elastic or inelastic? If the elasticity equals zero, is demand perfectly elastic or perfectly inelastic?.
Answer:
If the elasticity is greater than 1, the demand is elastic. If the elasticity equals zero,demand is perfectly inelastic
Explanation:
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Answer:
In economics, the theory of elasticity refers to how supply and demand respond to changes in the price of a product or service. Learn the definition of the theory of elasticity, the formula used for calculating elasticity, and the three main ways of interpreting the result.
Explanation:
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