Journal for macroeconomic

Figure 7.19 (find the figure in e-book) shows the spending per week in each category of a US consumer whose total expenditure on food is $80, with typical spending patterns across food categories.

Suppose that the price of category 30, high-calorie milk products, increased by 10%:

By what percentage would his demand for high-calorie milk products fall?

Calculate the quantity he consumes, in grams, before and after the price change.

Calculate his total expenditure on high-calorie milk products before and after the price change.

Now choose a category for which the price elasticity is less than 1, and repeat the calculations.

Show all the steps involved in your calculations. the figure https://www.core-econ.org/the-economy/book/texU07.html#figure-7-19

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sample Solution

ACED ESSAYS