Consider the following multiplicative demand function where QD = quantity demanded, P = selling price, and I
Question:
Consider the following multiplicative demand function where QD = quantity demanded, P = selling price, and I = disposable income:
QD = 1.6 P-1.5Y.2
QD = 1.6 P ^-1.5y.2
The coefficient of I indicates that (all other things being held constant):
for a one percent increase in disposable income, quantity demanded would increase by .2 percent, indicating that this good a necessity | |||
for a one percent increase in disposable income, quantity demanded would | |||
for a one percent increase in disposable income, quantity demanded would | |||
for a one percent increase in disposable income, quantity demanded would
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