Calculate the point price elasticities of supply

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Consider the market for cigarettes in New York City and Los Angeles. Suppose the daily demand for cigarettes in NYC is given as Qd=1000-100P, and the demand in LA is Qd=900-200P. The market supply for the two markets is the same: Qs=100+200P. Assume these two markets are totally separated.Calculate the point price elasticities of demand for both NYC and LA at equilibrium. Calculate the point price elasticities of supply for both NYC and LA at equilibrium.

Reference no: EM13214343

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