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step by step explanations please!! Q23. A constant elasticity of demand (CED) curve has the form Q, = QP for some parameter a, where &

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Q23. A constant elasticity of demand (CED) curve has the form Q, = QP for some parameter a, where & is the absolute value of the price elasticity of demand, Qp is measured in millions of barrels per day, and P is measured in dollars per barrel. Suppose you are told that: the world price of oil is about $60/barrel, the quantity demanded of crude oil for the world is about 90 million barrels/day, and the world short-run price elasticity of demand for crude oil is about -0.1. a) What arguments might you make for modelling demand using a CED rather than a linear demand curve? b) What is the appropriate a for a CED curve for crude oil? Calculate o and write the demand curve. c) By what percentage does the quantity of oil demanded fall if the price doubles from $60 to $120 per barrel

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