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AP Microeconomics 2.5 Other Elasticities Questions

Use income and cross-price elasticity to classify goods and explain how income or related-good prices change demand patterns.

Syllabus
Effective Fall 2022
Course
AP Microeconomics

Exam points

  • Calculate income and cross-price elasticity and classify goods as normal, inferior, substitutes, or complements.
  • Use elasticity values to predict quantity-demand changes after income or related-good price changes.

Covered syllabus points

MKT-3.E—a. Define measures of elasticity. b. Explain (using graphs where appropriate) measures of elasticity and the impact of a…—Topic 2.5

Question 1

[Maximum number: 1]

The table provided shows the marginal utility for Lucy when she consumes Good X and Good Y.

Table for Question 1 — AP Microeconomics

Suppose the price elasticity of demand for Good X is -2.0, the price elasticity of demand for Good Y is -0.8, and the cross-price elasticity of demand between Good X and Good Y is +1.6. Are goods X and Y complementary goods, substitute goods, normal goods, or inferior goods? Explain.

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