Calculate the price elasticity of demand for airplanes

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Reference no: EM13223307

The demand for Airplanes is represented by this equation : Qd=53,230 - .8V+.05Vr-3,600Vh + 4T

V is the Price for Airplanes
Vr is the price per trip in boats
Vh is the price per gallon of gasoline
T is the average income of a consumer

Imagine that the current price per boat is $5.
That the price per gallon of gas is $10
The average income is $50
The equilibrium price for Airplanes is $60,000

After getting the market-equilibruim quantity of airplanes.

Calculate : price elasticity of demand for airplanes, income elasticity of demand for airplanes, cross-elasticity of demand relative to boat transportation, and cross-elasticity of demand relative to gas.

Reference no: EM13223307

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