Table: Elasticities of Good X $$\begin{array} { l l }
\hline & \text { Good X } \
\hline \text { Price elasticity of demand } & 2.5 \
\text { Income elasticity of demand } & 0.5 \
\text { Cross-price elasticity of demand with Good Y } & 1.5 \
\text { Price elasticity of supply } & 1
\end{array}$$
Refer to the table. From the information in the table, what can you say about good X? In particular, is the demand for Good X rather elastic or inelastic? What does this imply about the number of substitutes that exist for Good X? Does Good Y appear to be a substitute for Good X? Does Good X appear to be a normal or inferior good? Finally, is the elasticity of supply for Good X relatively elastic or inelastic?

Question

Table: Elasticities of Good X $$\begin{array} { l l } 
\hline & \text { Good X } \
\hline \text { Price elasticity of demand } & 2.5 \
\text { Income elasticity of demand } & 0.5 \
\text { Cross-price elasticity of demand with Good Y } & 1.5 \
\text { Price elasticity of supply } & 1
\end{array}$$ 
Refer to the table. From the information in the table, what can you say about good X? In particular, is the demand for Good X rather elastic or inelastic? What does this imply about the number of substitutes that exist for Good X? Does Good Y appear to be a substitute for Good X? Does Good X appear to be a normal or inferior good? Finally, is the elasticity of supply for Good X relatively elastic or inelastic?

Quizplus · Accepted Answer

The Answer of Table: Elasticities of Good X $$\begin{array} { l l } 
\hline & \text { Good X } \
\hline \text { Price elasticity of demand } & 2.5 \
\text { Income elasticity of demand } & 0.5 \
\text { Cross-price elasticity of demand with Good Y } & 1.5 \
\text { Price elasticity of supply } & 1
\end{array}$$ 
Refer to the table. From the information in the table, what can you say about good X? In particular, is the demand for Good X rather elastic or inelastic? What does this imply about the number of substitutes that exist for Good X? Does Good Y appear to be a substitute for Good X? Does Good X appear to be a normal or inferior good? Finally, is the elasticity of supply for Good X relatively elastic or inelastic?

Table: Elasticities of Good X Refer to the Table