Price crosses elasticity of demand for complementary goods

When each 1 percent hike in the price of pencils causes a 2 percent decline within the quantity of erasers sold, the price crosses elasticity of demand for such complementary goods is about: (1) -2.0. (2) -1.0. (3) -4.0. (4) 2.0. (5) 1.0.

Can anybody suggest me the proper explanation for given problem regarding Economics generally?

View Complete Question

Related Questions in Microeconomics

Q : Possibility of price discrimination

Price discrimination is not possible when: (w) arbitrage is impossible. (x) all consumers have identical demand curves for the good. (y) firms are not price takers. (z) products are differentiated. Please choose th

Q : Analytic time in the market period In

In the market period: (w) price is constant. (x) output is constant. (y) supply is horizontal. (z) supply is completely elastic. Please guys help to solve this problem of Economics with some explan

Q : Opponents of Contribution Standard

Opponents of contribution standard for income distribution, the: (w) prefer a more efficient mechanism to distribute income. (x) accept marginal productivity theory. (y) question how well the market system measures productivity. (z) generally favor de

Q : State excess demand or inflationary gap

State excess demand or inflationary gap: Excess demand takes place whenever AD is bigger than AS at the level of full employment equilibrium.

Q : Psychic Income problem Assume that a

Assume that a few years after graduating, life as an investment banker became very frustrating that you switched careers to work as the professional cat walker, and were happier even although your annual income fell much than 80 percent. Your decreased money income is

Q : Greatest strategy for maximizing profit

Monsieur Cournot contains a monopoly on an artesian well from that flows tasty spring water reputed to have medicinal properties. To ignore incurring any variable costs, he is adamants that customers bring their own pails also fill th

Q : Examples of Complementary Goods Can

Can someone help me in finding out the right answer from the given options. Illustrations of complementary goods would not comprise: (1) Football tickets and rugby tickets. (2) Golf clubs and golf balls. (3) Laundry detergent and washing machines. (4)

Q : Increase profit of cartel-member A

A member of a cartel would be probably to increase its profits by: (1) undercutting the prices of other cartel members when this did not get caught. (2) setting its price above which of other cartel members. (3) aggressive nonprice marketing promotion

Q : Certainty and severity of punishment in

Rising the certainty and severity of punishment decreases cheating on an examination. This statement signifies: (i) Unrealistic expectations regarding student honesty. (ii) Purely normative visions of behavior. (iii) Misplaced cynicism since this issu

Q : Total sales revenues and price

If the price falls, there total sales revenues rise, in that case the price elasticity of demand: (1) relatively elastic. (2) relatively inelastic. (3) unitary elastic. (4) zero elastic. (5) inflexibly marginal.

Discover Q & A

Leading Solution Library

Avail More Than 1420634 Solved problems, classrooms assignments, textbook's solutions, for quick Downloads

No hassle, Instant Access

Start Discovering

18,76,764

1934144
Asked

3,689

Active Tutors

1420634

Questions
Answered

Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!

Submit Assignment