Define are goods x and z substitutes or complements

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Reference no: EM13203743

The demand curve for product X is given by Qxd = 5000 - 5Px - .1Pz where Pz = 50

a. What is the own price elasticity of demand when Px = $100? Is demand elastic or inelastic at this price? What would happen to the firm's (total) revenue if it decided to charge a price below $100? (Would revenue rise or fall.)

b. What is the own price elasticity of demand when Px = $900? Is demand elastic or inelastic at this price? What would happen to the firm's (total) revenue if it decided to charge a price above $900? (Would revenue rise or fall.)

c. What is the cross-price elasticity of demand between good X and good Z when Px = $100? Are goods X and Z substitutes or complements?

Reference no: EM13203743

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