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Imagine an economy with only one good, tea, in three varieties: chai tea, matcha tea and earl grey. The price elasticity of tea is a
Imagine an economy with only one good, tea, in three varieties: chai tea, matcha tea and earl grey. The price elasticity of tea is a measure of degree of in the economy. If the consumers are indifferent between the three kinds of tea, the price elasticity will be? and the price of all tea will be equal to ?. If the consumers have preferences for certain kinds of chocolate, the price elasticity will be less than ?
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