The demand for product X depends on the price of product X as well as the...
The demand for product X depends on the price of product X as well as the average household income (Y) according to the following relationship
Qdx = 600 - 25 P + 0.001Y
The supply of product X is positively related to own price of
product X and negatively dependent upon W, the price of some input.
This relationship is expressed as:
Qsx = 130 + 20 P - 3 W
Given that Y = 25,000 and W = 7, what is the:
1. Equilibrium price?
2. Equilibrium quantity?
Suppose that income increases to 35,000 and W remains constant. What is the new:
3. Equilibrium price?
4. Equilibrium quantity?
Assuming that income remains constant at 35,000 and W increases to 12, what is the new:
5: Equilibrium price?
6. Equilibrium quantity?
Homework Answers
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The demand for product X depends on the price of product X as
well as the...
The demand for product X depends on the price of product X as well as the...
The demand for product X depends on the price of product X as well as the average household income (Y) according to the following relationship Qdx = 800 - 35 P + 0.001Y The supply of product X is positively related to own price of product X and negatively dependent upon W, the price of some input. This relationship is expressed as: Qsx = 130 + 30 P - 2 W Given that Y = 50,000 and W = 10,...
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Consider the following demand function for good x -9-0.1p-Py+0.01p2+0.001Y, where Own price, P $30 Quantity demanded 28.75 Price of a related good, Py $5 Price of a related good, P $275 Consumer income, Y- $25,000 The income elasticity of demand,when equilibrium quantity is 28.75 units and income is $25,000 is equal to (Enter a numeric response using a real number rounded to three decimal places)
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of 2. (30 points) The demand of a product y depends on its own price UP ), and the price another product X (P. The price elasticity of Yis e,ー3.5, and the cross-price elasticity of Y with respect to X is e0.8. (a) Are X and Y substitutes or complements? lete (b) Suppose now P, increases by 2%, and r, decreases by 5%. Will the quantity demanded of Y increase or decrease? By what percent? 3. (20 points) The demand...
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Consider the following demand function for good x -9-0.1p-Py+0.01p2+0.001Y, where Own price, P $30 Quantity demanded 28.75 Price of a related good, Py $5 Price of a related good, P $275 Consumer income, Y- $25,000 The income elasticity of demand,when equilibrium quantity is 28.75 units and income is $25,000 is equal to (Enter a numeric response using a real number rounded to three decimal places)
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