the price of elasticity of demand for tvs in canada is 1.2 andthe income elastic

Question

the price of elasticity of demand for tvs in canada is 1.2 andthe income elasticity of demand for automobiles is 3. What would the effect of a 3 percent decline in tv prices onthe quantity of tvs demanded. What would be the effect of a 2 percent increase inincome? Some help please. Thank you so much in advance... the price of elasticity of demand for tvs in canada is 1.2 andthe income elasticity of demand for automobiles is 3. What would the effect of a 3 percent decline in tv prices onthe quantity of tvs demanded. What would be the effect of a 2 percent increase inincome? Some help please. Thank you so much in advance...

Explanation / Answer

Elasticity of Demand= %Change in Quantity demand /%ChangePrice 1.2= x/3%=3.6% increase in quantity demand for TV Income Elasticity= %change in Quantity Demand / % change inincome 3= %change in quantity demand / +2% = 6% increase in demandfor TV

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