[Step-by-Step] The demand for company X's product is given by Q x = 12-3P x + 4P y . Suppose good X sells for $3.00 per unit and good Y sells for $1.50 per
Question:
The demand for company X's product is given by Q
x
= 12-3P
x
+ 4P
y
. Suppose good X sells for $3.00 per unit and good Y sells for $1.50 per unit.
a. Calculate the cross-price elasticity of demand between goods X and Y at the given prices
b. Are goods X and Y substitutes or complements?
c. What is the own price elasticity of demand at these prices?
d. How would your answers to parts
a
and
c
change if the price of X dropped to $2.50 per unit?
Deliverable: Word Document 
(Solution Library) The following estimates have been obtained
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