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1 Elasticity This problem continues on from the previous homework. Consider the market for good X. The demand function is and the supply function is Px, Py, and Pz are the prices of goods X, Y, and Z. M is the average consumer income Suppose market research determines that M 105, Py 20, and Pz 10. 1.a Caleulate the cross-price clasticities of demand with respect to good Y and good Z at the market cquilibrium. Are goods Y and Z substitutes or complements for good X? 1.b Caleulate the income elasticity of demand at the market equilibrium. Is good X a normal good or an inferior good?

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2 dumand wih upec OP 2 an er kubs ti tute. as ositve DM 서 ositive asé

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