a) Suppose the cross elasticity of demand for products X and Y is +4.6 and for products E and F is -
Question: a) Suppose the cross elasticity of demand for products X and Y is +4.6 and for products E and F is -6.2. What can you conclude about the relationship of products X and Y of E and F?
b) The income elasticities of demand for movies, dental services, and clothing have been estimated to be +3.4, +1.0, and 0.5 respectively. Interpret these coefficients. What does it mean if an income elasticity coefficient is negative?
c) Mark’s income has increases from $20,000 to $25,000. His sister has observed that his demand for Caribbean vacations has increased by 12% while his demand for McDonald’s lunches has decreased by 8%. Calculate Mark’s income elasticity of demand for
i) Vacations to the Caribbean, ii) McDonalds lunches
Price: $2.99
Answer: The solution file consists of 2 pages
Deliverables: Word Document![](/images/msword.png)
Deliverables: Word Document
![](/images/msword.png)