Suppose the demand function for a consumer is given by $x \left( p _ { x } , p _ { y } \right) = \left( \frac { 4 p _ { y } } { p _ { x } } \right) ^ { 2 }$
a.What is the own-price elasticity of demand for x?
b What is the cross-price elasticity of demand for x?
c.What happens to spending on x as the price of x increases?
d.What is the income elasticity of demand for x? What does this tell you about what kind of good x must be?

Question

Suppose the demand function for a consumer is given by $x \left( p _ { x } , p _ { y } \right) = \left( \frac { 4 p _ { y } } { p _ { x } } \right) ^ { 2 }$ 
a.What is the own-price elasticity of demand for x?
b What is the cross-price elasticity of demand for x?
c.What happens to spending on x as the price of x increases?
d.What is the income elasticity of demand for x? What does this tell you about what kind of good x must be?

Quizplus · Accepted Answer

The Answer of Suppose the demand function for a consumer is given by $x \left( p _ { x } , p _ { y } \right) = \left( \frac { 4 p _ { y } } { p _ { x } } \right) ^ { 2 }$ 
a.What is the own-price elasticity of demand for x?
b What is the cross-price elasticity of demand for x?
c.What happens to spending on x as the price of x increases?
d.What is the income elasticity of demand for x? What does this tell you about what kind of good x must be?

Suppose the Demand Function for a Consumer Is Given By x