Question

1.) As the average hourly wage increases from $22 per hour to $28 per hour, the quantity demanded of Americano coffees increases from 3,000 to 3,450. What is the income elasticity of demand for Americano coffees?

Round your answer to the nearest hundredth. Your answer may be a positive or negative number.

Provide your answer below:

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2.)

As the average hourly wage increases from $20 per hour to $23 per hour, the quantity demanded of mobile phones increases from 4,000 to 8,500. What is the income elasticity of demand for mobile phones?

Round your answer to the nearest hundredth. Your answer may be a positive or negative number.

Provide your answer below:

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3.)

Which formula best represents the concept of cross-price elasticity of demand?

Select the correct answer below:

A. Cross-price elasticity of demand=% change in quantity demanded of good A% change in quantity demanded of good B

B. Cross-price elasticity of demand=% change in quantity demanded of good A% change in price of good B

C. Cross-price elasticity of demand=% change in price of good A% change in quantity demanded of good B

D. Cross-price elasticity of demand=% change in price of good B% change in quantity demanded of good A

4.)

Suppose the price of whistles increased 8% and the quantity demanded of basketballs decreased 15%. Calculate the cross-price elasticity of demand for basketballs.

Be sure to:

• Round your answer to the nearest hundredth.
• Include a negative sign in your answer if appropriate.

Provide your answer below:

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Answer 1

Answer to question 1 - 3 :