The demand for widgets (X) is given by the following
equation:
QX = A PX-0 .5 PW
PY-1.25 PZ-0.25 I
where PX is the price of widgets,
PY, PW and PZ are the prices of
woozles, gadgets, and whatsits respectively, and I is income.
(A) The manufacturer of widgets is contemplating
an increase in its price. Is it possible to know whether revenue
will increase or decrease given that the initial price of widgets
is not known? (2)
(B) By how much must the price of widgets change
if income decreases by 4% and the goal is to keep QX constant?
(2)
(C) By how much PX must change if the price of
whatsits (PZ) increases by 2% and the goal is to keep QX
constant? (2)
(D) How are widgets and woozles related in
consumption? (2)
(E) How are goods woozles and whatsits related in
consumption? (2)
The demand for widgets (X) is given by the following equation: QX = A PX-0 .5...
The demand for Widgets (QX) is a function of the price of widgets (PX), the price of woozles (PY), and per capita income (I): QX = 1950 - 10 PX + 5 PY - 0.1I Currently, PX = 25, PY = 10, and I = 15,000. (a) Calculate the elasticity of demand for widgets with respect to its own price, the price of woozles, and income. (b) Over what range of prices is the demand for widgets elastic? (c) If...
The demand for your product X has been estimated to be Qx = 7, 880 − 4Px − 2Py + Pz − 0.1M where Y and Z are other (related) products. The relevant price and income data are as follows: Px = 10, Py = 15, Pz = 50, M = 40, 000 (Please show work and answers to questions a-e) a. Which goods are substitutes for X? Which are complements? b. Is X an inferior or a normal good?...
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please calculate carefully The demand for good (Qx) is given by the following equation: Qx = 20,200 - 12.5 Px + 5 Py-M + 1.5 Ax Suppose the firm spends $3,000 per week on advertising (Ax), Px is $80, Py is $60, and income per capita (M) in the market area is $22,000. (a) Calculate the elasticity of demand for good X with respect to its own price, the price of good Y, and Income per capita. (3) (b) Calculate...
The demand for good X is given by QXd = 6,000 - (1/2)PX - PY + 9PZ + (1/10)M Research shows that the prices of related goods are given by Py = $6,500 and Pz = $100, while the average income of individuals consuming this product is M = $70,000. a. Indicate whether goods Y and Z are substitutes or complements for good X. Good Y is: (Click to select) a substitute neither complement nor substitute a complement . Good Z is: (Click to select) a complement a...
suppose demand for good X is given by QX = –5PX + 10PY + 1.25I. Suppose PY=$1 and I=$12. What is the equation for the own-price demand curve? What is the slope of the own-price demand curve? Calculate the price elasticity of demand if PX = $2. Interpret your result
The demand for good X is given by QXd = 6,000 - (1/2)PX - PY + 9PZ + (1/10)M Research shows that the prices of related goods are given by Py = $6,500 and Pz = $100, while the average income of individuals consuming this product is M = $70,000. a. Indicate whether goods Y and Z are substitutes or complements for good X b. Is X an inferior or a normal good? c. How many units of good X...
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Question The demand for good X is given by Ox 1,200-Px - 2y +4Pz+02M, where Py is the price of good Y. Pz is the price of good Z and M is income. If Py = $800, Pz = $200, and M= $5,000, what is the inverse demand function for good X? Explain your answer to get full credir! TTTT Paragraph y = - - Arial = - T - = = =
22. Consider two imaginary goods, widgets and gadgets. The cross-price elasticity of demand for widgets with respect to the price of gadgets is +0.5. This tells us that widgets and gadgets are a. Compliments b. Substitutes c. Unrelated in consumption For this condition to hold, 23. Assume that the market demand for widgets is perfectly inelastic. a. There must be no good substitute for widgets, and widgets must be a normal good. b. There must be no good substitute for...