Question
In: Economics
Cross-price elasticities Rice & beans -0.35 Rice & wheat 0.6 Rice & chicken -0.1 Rice &...
Cross-price elasticities
Rice & beans -0.35
Rice & wheat 0.6
Rice & chicken -0.1
Rice & milk -0.05
Rice & other goods 0
Income elasticity of demand for rice 0.4
1)What is the Own price elasticity of demand for rice ??
2) Which of the food item(s) are complement to rice?
3) Which of the food item(s) are substitute to rice?
4) Compute the own price elasticity of demand for rice using the income elasticity of demand for rice and cross-price elasticities reported in the table above (Hint: use the homogeneity condition).
Solutions
Rahul Sunny answered 1 year agoRelated Solutions
Rice and beans (–0.25) Rice and wheat 0.50 Rice and chicken (–0.15) Rice and milk (–0.05)...
Rice and beans
(–0.25)
Rice and wheat
0.50
Rice and chicken
(–0.15)
Rice and milk
(–0.05)
Rice and other goods
0
You are a planner for the country
represented above. The income elasticity of demand for rice is
0.8.:
Is this likely a relatively wealthy or relatively poor country?
Why?
Use the information above and the homogeneity condition to
determine the necessary percentage change in the price of rice that
will raise the consumption of rice by 5%.
If rice...
The table below provides information regarding price elasticities, income elasticities and cross-price elasticities of demand. Answer...
The table below provides information regarding price
elasticities, income elasticities and cross-price elasticities of
demand.
Answer the following questions by using the information from
this table.
Commodity
Price Elasticity
Income Elasticity
Price change in this commodity
Cross-price Elasticity
Electricity (at home)
0.15
0.25
Natural Gas
0.35
Restaurant Meals
1.9
2.5
----
----
Coffee
0.25
-----
Milk
-0.15
Bread
0.20
-0.10
----
----
a. Which commodities are normal and which are
inferior?
b. Which commodities are complements and which
are substitutes?...
a) What other elasticities of demand are there besides price, income, and cross price? (1mk) (b)...
a) What other elasticities of demand are there besides
price, income, and cross price? (1mk)
(b) What is the usefulness to the firm of the elasticity of demand
over which the firm has control? (2.5 marks)
(C) Why is it essential for the firm to use the elasticity of all
the variables included in the demand function? (2.5 marks)
"Jon consumes chicken (C) and rice (R) for his meals. The price of a unit of...
"Jon consumes chicken (C) and rice (R) for his meals. The price
of a unit of chicken is $6, and the price of a unit of rice is
$2.
Jon's utility function is: U = (3C)*(2R)
Jon has $132 to spend on chicken and rice."
a) For U = 100, which of the following (C,R) points are on the
indifference curve?
"Jon consumes chicken (C) and rice (R) for his meals. The price
of a unit of chicken is $6,...
"Jon consumes chicken (C) and rice (R) for his meals. The price of a unit of...
"Jon consumes chicken (C) and rice (R) for his meals. The price
of a unit of chicken is $6, and the price of a unit of rice is
$2.
Jon's utility function is: U = (3C)*(2R)
Jon has $132 to spend on chicken and rice."
a) For U = 100, which of the following (C,R) points are on the
indifference curve?
1. (30,20)
2. (10.35)
3.(4,54)
4. (0,50)
b) Is the indifference curve linear or non-linear?
c) Determine Jon's optimal...
Marco consumes chicken (C) and rice (R) for his meals. The price of a unit of...
Marco consumes chicken (C) and rice (R) for his meals. The price
of a unit of chicken is $6, and the price of a unit of rice is
$2.
Jon's utility function is: U = (3C)*(2R)
Jon has $132 to spend on chicken and rice."
a) For U = 100, which of the following (C,R) points are on the
indifference curve?
Group of answer choices
(30,20)
(10,35)
(4, 54)
(0,50)
b) Is the indifference curve linear or non-linear?
c) Determine...
Explain the differences among price elasticity, mid-point elasticity; Income and Cross Price elasticities.
Explain the differences among price elasticity, mid-point
elasticity; Income and Cross Price elasticities.
Rijo John has tried to estimate own and cross price elasticities for tobacco products in India....
Rijo John has tried to estimate own and cross price elasticities
for tobacco products in India. His findings for own price
elasticities are reported in the table below.
Bidis
Cigarettes
Rural
0.91
0.41
Urban
0.87
0.17
a. Compare the demand for bidis and Cigarettes in rural and
urban areas.
b. Draw neat diagrams for i) Demand Curve ii) Supply Curve iii)
demand elasticity iv) degrees of demand elasticity.
c. The demand for a product priced Rs. 10/unit and Rs. 8/unit...
The accompanying table lists the cross-price elasticities of demand for several goods, where the percent quantity...
The accompanying table lists the cross-price elasticities of
demand for several goods, where the percent quantity change is
measured for the first good of the pair, and the percent price
change is measured for the second good.
Good
Cross-price elasticities of demand
Apple and orange
+0.95
Shirt and trousers
-2.55
Explain the sign of each of the cross-price elasticities. What
does it imply about the relationship between the two goods in
question?
b.
Which of the following...
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