Answer to Question #316699 in Microeconomics for Lukki

Question

estimated demand function for processed pork is 𝑄 = 171 − 20𝑝 + 20𝑝𝑏 + 3𝑝𝑐 + 2Y. using the estimated demand function for processed pork, show how the quantity demanded at a given price changes as price of beef (Pb) decreases by N$0.95 a year.

Answer 1

Q=171-20p+20pb+3pc+2y

If the price of beef (Pb) decreases by 0.95, the quantity demanded at that price will decrease by 20*0.95 = 19 units.