Answer to Question #184213 in Microeconomics for Tehmasap Rabbani Khan

Question

The demand cure of necessities is inelastic. The demand cure of Luxuries is elastic. For both

goods, suppose producers produce more and supply becomes double

(at each price, Qs doubles).

1. For which product will P change the most?

2. For which product will Q change the most?

Answer 1

1. For which product will P change the most? Medicine

2. For which product will Q change the most? Luxury