Why would it be valuable for a business to know elasticity

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Q. Why would it be valuable for a business to know cross elasticity of demand for two products it produces: peanuts and popcorn? What is practical significance of income elasticity coefficients? Explain significance using as examples an income elasticity of 3.5 for computers and an income elasticity of 0.20 for ice cream. Is demand for a particular brand of car, like a Chevrolet, likely to be more or less price-elastic than demand for all cars?

Reference no: EM1369813

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