Question
Suppose the own price elasticity of demand for good X is -4, its income elasticity is 3, its advertising elasticity is 3, and the cross-price
Suppose the own price elasticity of demand for goodXis -4, its income elasticity is 3, its advertising elasticity is 3, and the cross-price elasticity of demand between it and goodYis 5. Determine how much the consumption of this good will change if:
Instructions: Enter your responses as percentages. Include a minus (-) sign for all negative answers.
a. The price of goodXdecreases by 6 percent.
________percent
b. The price of goodYincreases by 7 percent.
________percent
c. Advertising decreases by 2 percent.
_________percent
d. Income increases by 3 percent.
_________percent
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