答案和详解如下： 16.If quantity demanded declines 20 percent when incomes fall 3 percent, this good is: A) a luxury good. B) a necessity. C) an inferior good. D) an inelastic good. The correct answer was A) Income elasticity is the sensitivity of demand to changes in consumer income. Income elasticity for this good = (percent change in quantity demanded) / (percent change in income) = -20 / -3 = 6.7. Normal goods with high income elasticities (absolute values > 1) are considered luxury goods, a type of normal good that experiences a greater percentage increase in demand than the percentage increase in income. 17.Marko Tskitishvili, an economist, has been studying the drop in the price of the average household computer in the U.S. and wonders if computers should still be considered a luxury good or if it has now become a normal good. He conducts a survey of 500 people and finds the following: | 1998 | 2005 | Avg. Household Income | $41,000 | $53,000 | Avg. Computers Purchased per Household | 0.42 | 0.57 |
*Assume that 1998 is the base rate. Based on the above data, Tskitishvili would conclude that a computer is a: A) luxury good with income elasticity of 1.01. B) normal good with income elasticity of 0.84. C) normal good with income elasticity of 0.99. D) luxury good with income elasticity of 1.18. The correct answer was D) % change in computers demanded = ( 0.57- 0.42) / 0.495 = 30.30%
% change in income = ($53,000 - $41,000) / $47,000 = 25.53%
30.30% / 25.53% = 1.18 1.18 > 1 so Tskitishvili would conclude that computers are a luxury good. 18.Assume that for the average consumer, the quantity demanded for jeans increases from 5 to 7 pairs per year in response to a price decrease from $29 to $24 per pair. The price elasticity and relative elasticity of demand for jeans is best described by which of the following?
| Price elasticity of demand
| Relative elasticity
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A) -1.77 Relatively inelastic B) -2.32 Relatively elastic C) -1.77 Relatively elastic D) -2.32 Relatively inelastic The correct answer was C) The percentage change in quantity demanded is (7 – 5) / [(7 + 5) / 2] = 33.33% and the percentage change in price is (24 - 29) / [(24 + 29) / 2] = -18.87%. Thus, price elasticity = 33.33% / -18.87% = -1.77. A good is considered to be elastic if the absolute value of price elasticity is greater than 1. In this case, the absolute value of the price elasticity of demand for jeans is 1.77, so the price elasticity for jeans is relatively elastic. 19.Antonio Conti consumes 2 pounds of beef per week when beef is $4.50 per pound and 3 pounds of chicken when chicken sells for $3.50 per pound. If the price of chicken increases to $4.00 per pound, Conti’s consumption of beef increases to 2.5 pounds per week. Which of the following most accurately describes Conti’s cross elasticity of demand for beef versus chicken? The cross elasticity of demand for: A) beef relative to chicken is +1.67 and beef and chicken are complimentary goods. B) beef relative to chicken is +1.67 and beef and chicken are substitutes. C) chicken relative to beef is +1.75 and beef and chicken are substitutes. D) beef relative to chicken is -1.75 and beef and chicken are complimentary goods. The correct answer was B) The average quantity of beef demanded is (2.0 + 2.5) / 2 = 2.25 pounds, so the percentage change in the quantity of beef demanded is (2.5 – 2.0) / 2.25 = +22.22%. The average price of chicken is ($3.50 + $4.00) / 2 = $3.75 per pound, so the percentage change in the price of chicken ($4.00 – $3.50) / $3.75 = +13.33%. The cross elasticity of demand for beef relative to the price of chicken is 22.2 / 13.3 = 1.67. Since the cross elasticity is positive, chicken and beef are substitutes for Conti. | 
发表于 2008-4-4 16:38
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