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LiRa [457]
3 years ago
14

Suppose Nationwide increases the insurance premium they charge for their auto policies by 12 percent. In​ response, the demand f

or State Farm auto policies in a small town increases from 3 comma 000 to 3 comma 300. What is the​ cross-price elasticity of demand for State Farm auto policies in this​ town? Using the midpoint​ formula, the​ cross-price elasticity of demand for State Farm auto policies is nothing. ​(Enter your response rounded to three decimal​ places.)
Business
1 answer:
Ahat [919]3 years ago
6 0

Answer:

0.794

Explanation:

Cross price elasticity of demand measures the responsiveness of quantity demanded of good A to changes in price of good B.

Cross price elasticity of demand = percentage change in quantity demanded of good A / percentage change in price of good B

Midpoint change in quantity demanded = change in quantity demanded / average of both demands

change in quantity demanded = 3300 - 3000 = 300

average of both demands = (3300 + 3000 ) / 2 = 3150

300/3150 = 0.095238 = 9.5238%

Cross price elasticity = 9.5238% / 12% = 0.794

If cross price elasticity of demand is positive, it means that the goods are substitute goods.

If the cross-price elasticity is negative, it means that the goods are complementary goods.

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Saira's Maid Service began the year with total assets of $120,000 and stockholders' equity of $40,000. During the year the compa
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Answer:

$110,000

Explanation:

Calculation for How much was stockholders' equity at the end of the year

Beginning balance of stockholders' equity $40,000

Add net income $90,000

Less the dividends paid ($20,000)

Ending stockholders' equity $110,000

Therefore How much was stockholders' equity at the end of the year is $110,000

5 0
3 years ago
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5 0
2 years ago
16. According to data from the U.S. Department of Energy, sales of the fuel-efficient Toyota Prius hybrid fell from 194,108 vehi
Westkost [7]

Answer:

0.22 and substitutes goods

Explanation:

The computation of the cross-price elasticity of demand using mid point formula is shown below:

= (change in quantity demanded ÷ average of quantity demanded) ÷ (percentage change in price ÷ average of price)  

where,  

Change in quantity demanded is

= Q2 - Q1

= 180,603 - 194,108

= -13,505

And, the average of quantity demanded is

= (180,603 + 194,108) ÷ 2

= 187,356

Change in price is

= P2 - P1

= $2.43 - $3.36

= -$0.93

And, the average of price is

= ($2.43 + $3.36) ÷ 2

= 2.895

So, after solving this, the cross - price elasticity is 0.22

Since the cross - price elasticity is positive that reflect the goods are substitutes to each other

4 0
3 years ago
The basic difference between macroeconomics and microeconomics is: In a command economy, the __________ either makes most econom
Novay_Z [31]

Question 2 options are;

- government

- market

- firm

- business sector

Answer:

1. microeconomics concentrates on the behavior of individual consumers and firms, while macroeconomics focusses on the performance of the entire economy.

2. government.

Explanation:

1. Indeed, the government in a command economy (like China) makes most economic decisions itself or at least strongly influences how the decisions are made.

2. We note that the word 'macro' indicates large scope, while 'micro' indicates a smaller scope. And so, the difference is that microeconomics concentrates on the behavior of individual consumers and firms, while macroeconomics focusses on the performance of the entire economy.

5 0
3 years ago
Labeling researchers focus on "extra legal" variables to explain differences in arrest and prosecution rates as well as entencin
Elena L [17]
True

<span>Labeling theory is a sociological and criminological theory stating that a strong, negative reaction from society to an individual's crime or misbehavior can drive that individual to be more deviant by affecting (negatively) his/her self concept and by preventing him/her from gaining access to conventional opportunities.
</span>
Extralegal factors are those that are not covered or regulated by law. Examples of these factors or variables include gender, age, social class, race and economic status. Consciously or not, these variables can be taken as "biases" that may affect prosecution and arrest of certain individuals. 
3 0
3 years ago
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