Reply to classmate post: What is the cross price elasticity of demand of Good 1 given a change in the price of Good 2? 0.2685

Dallas Bates posted Jun 15, 2018 6:01 PM
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  1. What is the change in Q1 given a change in P1? -27.0763
  2. Is it statistically significant at the 95% level? Yes
  3. What is the mean of Q1? 56.33
  4. What is the mean of P1? 3.05
  5. What is the price elasticity of demand for Good 1? -1.4641
  6. Is the demand for Good 1 elastic or inelastic at the sample means of the data? Elastic
  7. To increase revenue, the firm selling Good 1 should raise or lower price? Lower
  8. What is the change in Q1 given a change in P2? 12.2362
  9. Is it statistically significant at the 95% level? Yes
  10. What is the mean of P2? 1.24
  11. What is the cross price elasticity of demand of Good 1 given a change in the price of Good 2? 0.2685
  12. Are Goods 1 and 2 substitutes or complements? Substitutes
  13. What is the change in Q1 given a change in INCOME? 0.0018
  14. Is it statistically significant at the 95% level? Yes
  15. What is the mean of INCOME? $32,291.76
  16. What is the income elasticity of demand for Good 1? 1.0579
  17. Is Good 1 a normal or inferior good? NormalIf normal, what type? Luxury
  18. What is the adjusted R2 ? 0.7882
  19. Given P1 = $3.75, P2 = $1.65, and INCOME = $38000 what is the forecasted value of Q1? 52.8592
  20. Given P2 = $1.65 and INCOME = $38000 what is the revenue-maximizing level of Q1? 72

What is the corresponding level of P1 that maximizes revenue? 3.05

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