Compute your income elasticity of demand as your income

Assignment Help Business Economics

Reference no: EM1350466

Suppose that your demand schedule for compact discs as follows:

price quantitydemand quantity demand
(income=$10000) (income=$12000)

$8 40CDs 50CDsa
10 32 45
12 24 30
14 16 20
16 8 12

A) Use the midpoint method to compute your price elastcityof demand as the price of compact discs increases from $8 to $10 if(i)your income is $10000and (ii)your income is $12000

B) Compute your income elasticity of demand as your incomeincreases from $10000 to $12000 if (i)the price is $12 and (ii)theprice is $16

Reference no: EM1350466

Questions Cloud

What plant size will firm choose in producing : What plant size will the firm choose in producing. Draw the firm's long-run average-cost curve on the diagram and define this curve.

Find the distance and direction from lake b : A ranger in a national park is driving at 28.0 mi/h when a deer jumps into the road 225 ft ahead of the vehicle. After a reaction time t, the ranger applies the brakes to produce an acceleration of a = -9.00 ft/s2. What is the most reaction time a..

Customer satisfaction - qualitative vs quantitative : Explain what is the difference between qualitative and quantitative measures regarding customer satisfaction

Development of cost standards : How are cost standards developed? Discuss the purpose for cost standards

Compute your income elasticity of demand as your income : Use the midpoint method to compute your price elastcityof demand as the price of compact discs increases. Compute your income elasticity of demand as your income increases.

Decision making question on investment : Explain what is important is being able to extrapolate all that information, and there is a lot of data out there, into a usable form for you to make wise investment decisions.

What will be the induced emf magnitude in the short coil : A 79 kg person sits on a 3.7 kg chair. Each leg of the chair makes contact with the floor in a circle that is 1.3 cm in diameter. Find out the pressure exerted on the floor by each leg of the chair, suppose the weight is evenly distributed.

Question on account balances : For each of the balances above would the account normally be a credit or debit balance? Enter the closing journal entries as of December 31st. What would the new balances of each account be?

Illustrate what risks do you face upon inquiry at your bank : Illustrate what risks do you face. Upon inquiry at your bank, you find that the forward price for a September contract to buy dollars is 10SKr per dollar. How might you hedge your exchange-rate risk for the first year.

User Account

All Pages