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Assume the extended demand function of good X is: QDX = 1400 - 20 PX - 10 PY + 0.1 M QDX = quantity demanded
Assume the extended demand function of good X is:
QDX = 1400 - 20 PX - 10 PY + 0.1 M
QDX = quantity demanded of good X
PX = Price of good X, M = Average consumer income
PY = Price of related good Y (related in consumption to good X)
M = Average consumer income
Assume that
PX= 50
PY = 50
M starts at 10,000 and increases to 20,000.What is the income elasticity of demand between these 2 values for M
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