Answer to Question #39978 in Microeconomics for Arash

Question #39978
The demand for good X is given by this equation:
QX =1.0–2.0PX +0.8I+1.5PY –3PZ+1.0A
Where PX, PY, and PZ represent the prices of goods X, Y, and Z;
I measures income per capita; and A is advertising. Currently:
PX =2.00,PY =2.50,PZ =1.00,I=4,andA=3.05.

Is good X a necessity or a luxury good? How do you know?

Calculate the cross elasticity of demand for X with respect to the price of good Z. Are goods X and Z substitutes or complements?
1
Expert's answer
2014-03-12T10:17:14-0400
The answer to the question is available in the PDF file https://www.assignmentexpert.com/homework-answers/economics-answer-39978.pdf

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