Consider the nonlinear demand function Q = X^aY^bZ^c that represents the call for three goods with...
Consider the nonlinear demand function Q = X^aY^bZ^c that represents the call for three goods with prices X,Y, and Z, respectively. If a, b, and c are constants then derive the point elasticity of Q with respect to X.
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Consider the nonlinear demand function Q = X^aY^bZ^c that
represents the call for three goods with...
Given the following nonlinear demand function for processed pork Q = 250 - p3 + 0.7logPb...
Given the following nonlinear demand function for processed pork Q = 250 - p3 + 0.7logPb +0.9logy, where Q is the quantity demanded for processed pork, P is the price of processed pork, Pg is the price beef and Y is the consumer's income. If P = N$3, PB = N$100 and Y = N$5000, income elasticity is Select one: O A. 19.76% O B. 90% O C. 0.9%
In the nonlinear function Y=aXbZc, the parameter c measures A. delta Y/ delta Z B. the...
In the nonlinear function Y=aXbZc, the parameter c measures A. delta Y/ delta Z B. the percent change in Y for a 1 percent change in Z C. the elasticity of Y with respect to Z D. both a and c E. both b and c
1 Elasticity This problem continues on from the previous homework. Consider the market for good X....
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...
4. Given the estimated demand function for good 1: Q = 50 - 4P,-3.2P, + 0.017,...
4. Given the estimated demand function for good 1: Q = 50 - 4P,-3.2P, + 0.017, where P, and P, are prices for good 1 and 2, respectively, and Y is income. (a) (2 points) Are good 1 and good 2 complements or substitutes? Why? (b) (3 points) Calculate the cross-price elasticity of demand for good 1, with respect to the price of good 2, given P, = $1.20, P, = 3.50, and Y = $15,000.
1) Given the following demand function Q=8.5-p+0.1y a) Derive a formular for the price elasticity of...
1) Given the following demand function Q=8.5-p+0.1y a) Derive a formular for the price elasticity of demand and income elasticity of demand. b) find the elasticity if p=6 and y=1000 c) what will happen to price elasticity of demand if income varies. d) what will happen to income elasticity of demand if income varies. e) derive the total revenue function. show that the relationship between price and revenue depends on elasticity (Assume y = 0).
Consider the following function: where x1 2 0,0,A 0, 0<1. a) Suppose that the preferences of...
Consider the following function: where x1 2 0,0,A 0, 0<1. a) Suppose that the preferences of a consumer regarding the consumption of goods x1 and x2 are represented by function = f(x1,x2) above. Suppose also that the consumer is endowed with some disposable income Y > 0 and faces prices pı and p2 respectively for goods x1 and x2. i) Derive and describe the demand of the consumer for goods x1 and x2. [20 marks] i) Are demand functions affected...
2. Marginal products, RTS, and elasticity of substitution: Consider the following production function: q=k *11/4 a....
2. Marginal products, RTS, and elasticity of substitution: Consider the following production function: q=k *11/4 a. For some w, y, use the Lagrangean method to derive demand functions by finding the cost-minimizing combinations of k and I in terms of q, w, and y (so the cost function is the objective function, and the production function is the constraint). (10 points) b. What is the rate of technical substitution (RTS) for this function? (5 points) C. Presume that the firm...
Consider the following demand function for good 'X': Q = 9 -0.1px - Py + 0.01p2...
Consider the following demand function for good 'X': Q = 9 -0.1px - Py + 0.01p2 +0.001Y, where Own price, Px = $120 Quantity demanded = 13.75 Price of a related good, Py = $6 Price of a related good, Pz = $275 Consumer income, Y = $20,000 The income elasticity of demand, s, when equilibrium quantity is 13.75 units and income is $20,000 is equal to : (Enter a numeric response using a real number rounded to three decimal...
Suppose demand for inkjet printers is estimated to be Q 1000 2pz + 0.1 Y. If...
Suppose demand for inkjet printers is estimated to be Q 1000 2pz + 0.1 Y. If p = 90, px = 70, pz = 130, and Y = 21,000; answer the following: 5p + 10px a. What is the price elasticity of demand? b. What is the cross price elasticity with respect to commodity X? Give an example of what commodity X might be. c. What is the cross price elasticity with respect to commodity Z? Give an example of...
Consider the following demand equation for good a. Good a demands is a function of income...
Consider the following demand equation for good a. Good a demands is a function of income (Y) and prices of good b and c. QDa(p,Y,pb,pc) = 12 − 3pa + 5Y −3pb +4pc. Pa = 2 Y=500 Pb = 3 Pc = 5 a. Calculate elasticity of demand. Does it respect law of demand? is it elastic or inelastic? Why? b. Calculate elasticity of income. Is it inferior or nomal good? Why? c. Calculate cross-price elasticities with good b. Is...
Given the following nonlinear demand function for processed pork Q = 250 - p3 + 0.7logPb +0.9logy, where Q is the quantity demanded for processed pork, P is the price of processed pork, Pg is the price beef and Y is the consumer's income. If P = N$3, PB = N$100 and Y = N$5000, income elasticity is Select one: O A. 19.76% O B. 90% O C. 0.9%
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...
4. Given the estimated demand function for good 1: Q = 50 - 4P,-3.2P, + 0.017, where P, and P, are prices for good 1 and 2, respectively, and Y is income. (a) (2 points) Are good 1 and good 2 complements or substitutes? Why? (b) (3 points) Calculate the cross-price elasticity of demand for good 1, with respect to the price of good 2, given P, = $1.20, P, = 3.50, and Y = $15,000.
Consider the following function: where x1 2 0,0,A 0, 0<1. a) Suppose that the preferences of a consumer regarding the consumption of goods x1 and x2 are represented by function = f(x1,x2) above. Suppose also that the consumer is endowed with some disposable income Y > 0 and faces prices pı and p2 respectively for goods x1 and x2. i) Derive and describe the demand of the consumer for goods x1 and x2. [20 marks] i) Are demand functions affected...
2. Marginal products, RTS, and elasticity of substitution: Consider the following production function: q=k *11/4 a. For some w, y, use the Lagrangean method to derive demand functions by finding the cost-minimizing combinations of k and I in terms of q, w, and y (so the cost function is the objective function, and the production function is the constraint). (10 points) b. What is the rate of technical substitution (RTS) for this function? (5 points) C. Presume that the firm...
Consider the following demand function for good 'X': Q = 9 -0.1px - Py + 0.01p2 +0.001Y, where Own price, Px = $120 Quantity demanded = 13.75 Price of a related good, Py = $6 Price of a related good, Pz = $275 Consumer income, Y = $20,000 The income elasticity of demand, s, when equilibrium quantity is 13.75 units and income is $20,000 is equal to : (Enter a numeric response using a real number rounded to three decimal...
Suppose demand for inkjet printers is estimated to be Q 1000 2pz + 0.1 Y. If p = 90, px = 70, pz = 130, and Y = 21,000; answer the following: 5p + 10px a. What is the price elasticity of demand? b. What is the cross price elasticity with respect to commodity X? Give an example of what commodity X might be. c. What is the cross price elasticity with respect to commodity Z? Give an example of...
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