Chapter 5: Q.22 (page 130)
What is the formula for the cross-price elasticity of demand?
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Would you usually expect elasticity of demand or supply to be higher in the short run or in the long run? Why?
From the data in Table 5.5 about the demand for smartphones, calculate the price elasticity of demand from point B to point C, point D to point E, and point G to point H. Classify the elasticity at each point as elastic, inelastic, or unit elastic.
Can you think of an industry (or product) with near-infinite elasticity of supply in the short term? That is, what is an industry that could increase Qs almost without limit in response to an increase in the price?
Suppose you could buy shoes one at a time, rather than in pairs. What do you predict the cross-price elasticity for left shoes and right shoes would be?
Say that a certain stadium for professional football has 70,000 seats. What is the shape of the supply curve for tickets to football games at that stadium? Explain
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