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1. Jasmin spends all her income on three goods: at, v, and a. The initial prices are [phpw p2) = {1, 2, 3). Her initial
1. Jasmin spends all her income on three goods: at, v, and a. The initial prices are [phpw p2) = {1, 2, 3). Her initial demands for the three goods are (x; 3.?! z] 2 (Bill), 45G, EDD]. Now the price of good it decreases to SELBIJ [the other prices do not change}. Her new demands for the three goods are (1:, 33,2] : III". 4E0, 183). a. Calculate her cross-price orc elasticities of demand a\". and an. [4] b. Calculate her orc elasticity:r of demand for as, ex. [4} c. What effect would a tax on good :u'. have on the market equilibrium in good v and good 2? {E}
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