Not sure what you mean. However, an example of complimentary products are cars and petrol.
If the price of petrol falls, this can stimulate more people to buy cars as they can better afford to run them. Or, if the price of cars falls then more will be bought and also more petrol will be bought to run the cars.
These are payment to producers, usually from governments. Effectively, they lower the cost of production so that producers are encouraged to produce more.
Hi. The change in demand is 10k-9k=1k; proportional is 1k/10k = 10% Change in price is 25-20 = 5; proportional is 5/20=25% Price elasticity of demand is proportional change in demand/proportional change in price => 10/25 = 0.4
I keep falling, and I think my answers are correct can you plz send me answers so I can review where I am wrong… I did everything as the lecturer explained. I wonder where I am wrong. Isn’t the answer to the first question 0.5
They are discussed on Page 133 of the current notes. Question 5 should refer to a shift in supply curves, not cost curves and this will soon be changed. Apologies for the error.
There is no other elasticity of demand you can calculate with this data or any other elasticity of demand that is in the syllabus or study guide, which states: 5. b) Explain elasticity of demand and the impact of substitute and complementary goods.
Ebrahim21 says
Does a rightward shift in demand curve mean an increase in demand? If so, then doesn’t decrease in selling price increase demand?
Ebrahim21 says
Referring to question 2 by the way
zuhairabbas says
Both the video Lectures and the notes are very helpful, Thank you
zuhairabbas says
I GOT 100% .
moe544 says
May i know where can i see answer
peddyk2 says
Is the inelastic curve not supposed to be less steep that the elastic curve? Or maybe I didn’t understand the question
Ken Garrett says
Sketch a PQ graph PQ graph with P vertical and Q horizontal. Draw two lines on it, sloping down to the right, at different slopes.
The less steep line says that a small change in price produces a large change in quantity. That is an elastic characteristic.
The steeper line shows that it takes a large change in price to produce a change in quantity, so that is an inelastic product.
So, the line for an inelastic product is steeper than for an elastic product.
Therefore the proposition in the question is FALSE.
mukape says
please explain the concept of fall in product price when complimentary products rise
Ken Garrett says
Not sure what you mean. However, an example of complimentary products are cars and petrol.
If the price of petrol falls, this can stimulate more people to buy cars as they can better afford to run them. Or, if the price of cars falls then more will be bought and also more petrol will be bought to run the cars.
tabasumze says
Can you please explain what is subsidies for production?
Ken Garrett says
These are payment to producers, usually from governments. Effectively, they lower the cost of production so that producers are encouraged to produce more.
thinzartun says
100%
manlian90 says
hard to get a pass rate especially in demand and supply curve.
protant says
please send me the procedure of question number 1
poddubny says
Hi. The change in demand is 10k-9k=1k; proportional is 1k/10k = 10%
Change in price is 25-20 = 5; proportional is 5/20=25%
Price elasticity of demand is proportional change in demand/proportional change in price => 10/25 = 0.4
agboolakenny84 says
Thanks a lot
peeteekays says
Wooow I just passed everything im happy first time to get 100%…….yeeepy
zahraacca2 says
I keep falling, and I think my answers are correct can you plz send me answers so I can review where I am wrong… I did everything as the lecturer explained. I wonder where I am wrong.
Isn’t the answer to the first question 0.5
zahraacca2 says
Okay I got it 0.4
sushanth12 says
I got 100percent
zahraacca2 says
Can you tell me your answers. I think I am doing it right but for some reason it’s not correct
Ralitsa says
The latest notes you have for this exam end with page 103
Ken Garrett says
The notes end at page 140.
Ralitsa says
nowhere in the notes is the cost curve shift discussed
Ken Garrett says
They are discussed on Page 133 of the current notes. Question 5 should refer to a shift in supply curves, not cost curves and this will soon be changed. Apologies for the error.
pacos76 says
First and last questions not very clear
pacos76 says
Not clear last question, many people have issues here
khiloo90 says
man the first question is wrong it is missing the word price
Ken Garrett says
There is no other elasticity of demand you can calculate with this data or any other elasticity of demand that is in the syllabus or study guide, which states: 5. b) Explain elasticity of demand and the impact of substitute and complementary goods.
tree21 says
Can anyone give me the answer because I keep failed.
Ken Garrett says
I think it’s OK.
stefenite says
Is it “cost curve” in the last qustion or maybe the supply curve is right?
ghassen2018 says
Same here i did not understant the question, and I did not pass, any one can help please
Ken Garrett says
See pages 132 and 133 in the notes where shifting of a cost curve to the right is explained.