Author Question: Microsoft raises the price of its Office software by 10 percent. As a result, the quantity of ... (Read 49 times)

Alygatorr01285 · **on:** Jun 29, 2018

Microsoft raises the price of its Office software by 10 percent. As a result, the quantity of personal computers demanded at the current price decreases by 5 percent.

What is the cross elasticity of demand for personal computers with respect to the price of Microsoft Office software? A) -2.0
B) -0.5
C) 0.5
D) 2.0

Question 2

The more ________, the larger is the amount of the tax on the good that the ________ pays.

A) elastic the demand for a good; buyers
B) inelastic the demand for a good; buyers
C) inelastic the supply of a good; buyers
D) elastic the supply of a good; sellers