1. Suppose that the quantity demanded and prices for \( \mathrm{X} \) and \( \mathrm{Y} \) goods are given in the following table. \begin{tabular}{|c|c|c|c|c|} \hline \multirow{2}{*}{ Good } & \multicolumn{2}{|c|}{ Before } & \multicolumn{2}{c|}{ After } \\ \cline { 2 - 5 } & \( \mathrm{P} \) (TL/cup) & \( \mathrm{Q} \) (cup/month) & \( \mathrm{P} \) (TL/cup) & \( \mathrm{Q} \) (cup/month) \\ \hline (Y) & 40 & 50 & 60 & 30 \\ \hline\( (\mathbf{X}) \) & 20 & 40 & 20 & 50 \\ \hline \end{tabular} By using this data: a) Calculate the cross price elasticity, \( e_{X Y} \) for these goods \( \sqrt[3]{ } \) p b) How can you define these goods? (2p).
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It is calculated using the following formula: \[ e_{XY} = \frac{\text{Percentage change in quantity demanded of good X}}{\text{Percentage change in price of good Y}} \] Show more…
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