Showing Page:
Solve the following problems. Show your solution.
1. When the price of good A falls from P30 to P24, quantity demanded of good B increases
from 130 units to 235 units. Compute for the elasticity. Indicate the relationship of
good A and good B?
2. The current price of a bicycle is P3,500, at this market price producers are willing to sell
245 bicycles. Suppose the price of a bicycle increases to P 4,100, at this market price
producers are willing to sell 390 units. Compute for the price elasticity of supply,
indicate the range of elasticity.
3. This year the average monthly income of a family is P 20,000, with this amount
quantity demanded of good W is 452 units. Last year the average income of a family
was P14, 500 and quantity demanded of good W was 556 units. Compute for the income
elasticity and determine what kind of good is good W.
4. If prices were increased from $40 to $42 and quantity demanded fell from 50 to 45 ,
calculate elasticity: state whether demand is elastic, unit elastic, or inelastic; and find
how much total revenue was when price was $40 and $42. What was the effect of the
price change on total revenue?
5. The quantity demanded for good A increases from 300 to 400 as the price of good B
increases from $1 to $2. What is the cross-price elasticity coefficient and how are
goods A and B related?

Unformatted Attachment Preview

Name: Description: ...
User generated content is uploaded by users for the purposes of learning and should be used following Studypool's honor code & terms of service.