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Quantity demanded and price and income

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Reference no: EM131293266

Suppose the relationship between quantity demanded and price and income is estimated to be

Q = 30P-2.5 I-0.8

a) What effect on quantity demanded (in percentage terms) will have a 5% change in price have?

b) What effect will a 10% price increase have on total revenue?

c) Is this a normal, inferior, or luxury good? Explain.

Reference no: EM131293266

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