Question 4 (9 marks in total) Suppose the demand function of product A is given as Q = 220 −4²₁ +2PB+, where 50 QA = qua

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Question 4 9 Marks In Total Suppose The Demand Function Of Product A Is Given As Q 220 4 2pb Where 50 Qa Qua 1 (102.32 KiB) Viewed 49 times

Question 4 (9 marks in total) Suppose the demand function of product A is given as Q = 220 −4²₁ +2PB+, where 50 QA = quantity demand for product A PA = Unit price of product A PB = Unit price of product B Y = Income of the consumer (a) Calculate the price elasticity of product A with respect to its own price. Evaluate the price elasticity of product A with respect to its own price when PA = 5, PB = 6, Y = 1900. [hint: Price elasticity of demand = QAX PA] (Give your answer to 2 decimal places.) (3 marks) OPA QA (b) Calculate the value of income elasticity of demand for product A when PA = 0, PB = 10, Y = 2000. [Hint: Income elasticity of demand (Give your answer to 2 decimal places.) (3 marks) ƏQA Əy = X (c) Calculate the total percentage change in demand for A when income of the consumer decreases by 10%. (Give your answer to 2 decimal places.) (3 marks)