SUPPOSE FOR A COMMODITY X, DEMAND AND SUPPLY CURVES ARE GIVEN BY THE EQUATIONS (1) QD = 4 – P (2) QS = -2+P (A) WHAT ARE THE PRICE ELASTICITIES OF THE DEMAND CURVE AND THE SUPPLY CURVES AT THE POINTS P = 1, 2, 3, ETC.? (B) SUPPOSE FOR COMMODITY X, THE PRICE ELASTICITY OF DEMAND IS CONSTANT THROUGHOUT THE CURVE. WHAT CAN YOU SAY ABOUT THE FUNCTIONAL FORM OF THE DEMAND CURVE?

/in /by

SUPPOSE FOR A COMMODITY X, DEMAND AND SUPPLY CURVES ARE GIVEN BY
THE EQUATIONS

(1)         QD
= 4 – P

(2)         QS
= -2+P

(A)  WHAT ARE THE PRICE ELASTICITIES OF THE DEMAND CURVE AND THE
SUPPLY CURVES AT THE POINTS P = 1, 2, 3, ETC.?

(B)  SUPPOSE FOR COMMODITY X, THE PRICE ELASTICITY OF DEMAND IS
CONSTANT THROUGHOUT THE CURVE. WHAT CAN YOU SAY ABOUT THE FUNCTIONAL
FORM OF THE DEMAND CURVE?

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