Question: Why do economists complicate the equation for elasticity by averaging
Why do economists complicate the equation for elasticity by averaging prices and quantities?
Answer to relevant QuestionsGovernment is advised to tax goods whose demand curves are inelastic if the goal is to raise tax revenues. If the goal is to discourage consumption, then it ought to tax goods whose demand curves are elastic. Explain. Calculate the income elasticities (at each income level) for boxes of Girl Scout cookies. What arguments can their opponents use to undermine that position? Suppose you are already at the point of maximizing utility in your consumption of four goods —T-shirts, movies, CDs, and books—and the following table represents this maximization. Fill in the missing numbers for prices ...If a price ceiling were imposed in a fish market whose equilibrium price was substantially above the ceiling, what effect would the price ceiling on fish have on the demand for meat and fowl?
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