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Lorena likes to play golf. The number of times

per year that she plays depends on both the price of playing a round of

golf as well as Lorena s income and the cost of other types of

entertainment in particular how much it costs to go see a movie

instead of playing golf. The three demand schedules in the table

below show how many rounds of golf per year Lorena will demand at each

price under three different scenarios. In scenario D1 Lorena s income

is $50000 per year and movies cost $9 each. In scenario D2 Lorena s

income is also $50000 per year but the price of seeing a movie rises

to $11. And in scenario D3 Lorena s income goes up to $70000 per

year while movies cost $11. Scenario: D1 D2 D3 Income: $50000

$50000 $70000 Movie Price: $9 $11 $11 Golf: Quantity Demanded

Quantity Demanded Quantity Demanded Price = $50 15 10 15 Price = $35

25 15 30 Price = $20 40 20 50 a. Using the data under D1 and D2

calculate the cross elasticity of Lorena s demand for golf at all

three prices. (To do this apply the midpoints approach to the cross

elasticity of demand.) Instructions: Enter only whole number for

your answer. Cross elasticity of Lorena s demand at the price of

$50 = Instructions: Round your answer to two decimal places.

Cross elasticity of Lorena s demand at the price of $35 =

Instructions: Round your answer to two decimal places. Cross

elasticity of Lorena s demand at the price of $20 = Is the cross

elasticity the same at all three prices? Are movies and golf

substitute goods complementary goods or independent goods? b.

Using the data under D2 and D3 calculate the income elasticity of

Lorena s demand for golf at all three prices. (To do this apply the

midpoints approach to the income elasticity of demand.) Instructions:

Round your answer to one decimal place. Income elasticity of Lorena

s demand at the price of $50 = Instructions: Enter only whole

number for your answer. Income elasticity of Lorena s demand at

the price of $35 = Instructions: Round your answer to two decimal

places. Income elasticity of Lorena s demand at the price of $20 =

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