PQ exam 2

PQ exam 2 - ECON 303 Practice Questions for Exam 2 1. The...

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ECON 303 Practice Questions for Exam 2 1. The demand for good X has been estimated by Q d = 12 - 3P x + 4P y . Suppose that good X sells at $2 per unit and good Y sells for $1 per unit. a. What is the own-price elasticity of demand for good X? ( Answer: -0.6 ) b. If the price of good X increases by 10%, what would be the expected change in the quantity demanded of good X? ( Answer: -6% ) 2. The demand for good X has been estimated by Q d = 15 - 3P x - 2P y . Suppose that good X sells at $1 per unit and good Y sells for $2 per unit. a. What is the own-price elasticity of demand for good X? ( Answer: -0.38 ) b. If the price of good X decreases by 10%, what would be the expected change in the quantity demanded of good X? ( Answer: 3.8% ) 3. Suppose X and Y are the only two goods available for purchase and P x = $10, P y = $15, X = 30, and M = 600? a. What is the maximum amount of good Y that can be purchased? ( Answer: 20 ) 4. Suppose X and Y are the only two goods available for purchase and P x = $5, P y = $10, Y = 40, and M = 600? a.
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PQ exam 2 - ECON 303 Practice Questions for Exam 2 1. The...

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