Assume that the price elasticity of demand for a commodity is ...

[ts19998]

Assume that the price elasticity of demand for a commodity is 0.20 . A 10 percent increase in the price of the commodity will be followed by a:
 a. 20 percent increase in the quantity demanded.
  b. 2 percent decrease in the quantity demanded.
  c. 20 percent decrease in the quantity demanded.
  d. 0.2 percent decrease in the quantity demanded.
  e. 2 percent increase in the quantity demanded.

Question 2

In consumer equilibrium, the marginal utility of good A, B and C are 100, 300, and 400 respectively. If the price of good A was 35, then the prices of goods B and C, respectively, are:
 a. 105 and 140.
  b. 140 and 105.
  c. 105 and 175.
  d. 140 and 175.

[Loise Hard]

Answer to Question 1

b

Answer to Question 2

a

[ts19998]

Thanks for the timely response, appreciate it

[irishcancer18]

Excellent