Compute the price elasticity of demand for automobiles

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Between 2007 and 20008, the quality of automobiles produced and sold declined by 10 percent. During this period the real price of cars increased by 5 percent, real income levels increased by 2 percent, and the real cost of gasoline declined by 20 percent. Knowing that the income elasticity of demand is +1.5 and the cross price elasticity of gasoline and cars is -0.3, compute the price elasticity of demand for automobiles during this period

Reference no: EM131240513

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