Using either the arc elasticity formula or calculus, calculate cross price elasticity of demand (Exy) for pork with respect to beef around (i.e., +/- 1%) a price of beef of $6.00, given a market price for pork of $3.00, and given the following information: Qork 130-40pPork +51 +11pBeef +8pChicken Qork 160 + 10pPork-2pLabor-6pRent - 4pCapital Where: I= income = 6 pBeef price of beef = 6 pChicken price of chicken = 3 = plabor labor wage rate = 8 pRent price of rent = 6 pCapital price of capital = 2 = = NOTE: Elasticity calculations are very sensitive to rounding. If you elect to perform multiple individual calculations, use and round to six significant digits (i.e., six decimal places, e.g., 0.000001) in each calculation.
Using either the arc elasticity formula or calculus, calculate cross price elasticity of demand (Exy) for pork with respect to beef around (i.e., +/- 1%) a price of beef of $6.00, given a market price for pork of $3.00, and given the following information: Qork 130-40pPork +51 +11pBeef +8pChicken Qork 160 + 10pPork-2pLabor-6pRent - 4pCapital Where: I= income = 6 pBeef price of beef = 6 pChicken price of chicken = 3 = plabor labor wage rate = 8 pRent price of rent = 6 pCapital price of capital = 2 = = NOTE: Elasticity calculations are very sensitive to rounding. If you elect to perform multiple individual calculations, use and round to six significant digits (i.e., six decimal places, e.g., 0.000001) in each calculation.
Chapter5: Elasticity Of Demand And Supply
Section: Chapter Questions
Problem 1.1P: (Calculating Price Elasticity of Demand) Suppose that 50 units of a good are demanded at a price of...
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Transcribed Image Text:Using either the arc elasticity formula or calculus, calculate cross price elasticity of demand
(Exy) for pork with respect to beef around (i.e., +/- 1%) a price of beef of $6.00, given a
market price for pork of $3.00, and given the following information:
Where:
I= income = 6
pBeef price of beef = 6
Chicken price of chicken = 3
0.507692
0.230769
NOTE: Elasticity calculations are very sensitive to rounding. If you elect to perform multiple
individual calculations, use and round to six significant digits (i.e., six decimal places, e.g.,
0.000001) in each calculation.
0.184615
0.061538
Qork
130-40pPork +51 +11pBeef +8pChicken
Qork 160 + 10pPork-2pLabor-6pRent - 4pCapital
-0.123077
O-0.276923
O-0.923077
plabor labor wage rate = 8
pRent price of rent = 6
pCapital price of capital = 2
-
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