2.8 Studies have fixed the short-run price elasticity of demand for HPV vaccines at -0.25. Suppose that

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2.8 Studies have fixed the short-run price elasticity of demand for HPV vaccines at -0.25. Suppose that transportation issues lead to a sudden cutoff of vaccine supplies.

As a result, supplies of HPV vaccines drop 20 percent.

a. If HPV vaccines were selling for $130 per dose before the cutoff, how much of a price increase would you expect to see in the coming months?

b. Suppose that the government imposes a price ceiling on HPV vaccines at $130 per dose. How would the relationship between vaccine recipients and hospital/clinic owners change?

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Principles Of Microeconomics

ISBN: 9789813107342

12th Global Edition

Authors: Karl E. Case, Sharon E. Oster, Ray C. Fair

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