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Unformatted text preview: Cobb – Douglas ε = 1 (Show) Perfect Substitutes ε = ? Perfect Complements ε = ? INCOME ELASTICITY OF DEMAND Income Elasticity of demand i i i x M M x . ∂ ∂ = η η i > 0 Normal good η i < 0 Inferior good CROSS PRICE ELASTICITY OF DEMAND Cross Price Elasticity of demand i j i i ij x p p x . ∂ ∂ = ε ε ij > 0 Substitutes ε ij < 0 Complements...
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This note was uploaded on 09/21/2011 for the course ECON 1230 taught by Professor Qwe during the Spring '11 term at UC Irvine.
 Spring '11
 qwe
 Income Elasticity, Price Elasticity

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