Change in price and total expenditure

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Reference no: EM1311285

1. Explain how a change in price affects total expenditure by filling in each cell with the resulting change in total expenditure.

Demand is ...	Increase in Price	Decrease in Price
Elastic
Unit-elastic
Inelastic

2. You buy only apples and bananas. Your budget is such that you can purchase 3 apples and 4 bananas or 9 apples and 2 bananas. Write down the equation for the budget line with bananas on the y-axis. Is that equation unique?

Reference no: EM1311285

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