# Questions tagged [price]

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### Why two goods are of different types of Cross Elasticity if we swap them in formula?

I am using this formula for calculating Cross elasticity of demand: $E_{XY}^D = \Large\frac{(Q_2^X - Q_1^X)(P_2^Y + P_1^Y)}{(Q_2^X + Q_1^X)(P_2^Y - P_1^Y)}$ If $E_{XY}^D$ > 0 Then goods X and Y ...
582 views

### Two-good economy, can we tell if the demand of good 1 rises or falls when the price of good 2 rises (price of 1 is constant)?

Suppose we have a two-good economy, and we know that good 1 is a normal good. Can we then make any meaningful observation about the demand for good 1 when we change the price of good 2 and keep the ...
171 views

### When to use the market and when to use central planning?

I have a basic question: my understanding is that in a market economy, economic decisions are governed by prices, i.e prices signal what should be produced & how much. This is opposed to central ...
1k views

### Price Floors and Subsidies

Why would a government choose to impose a price floor for agricultural commodities when subsidies would prove to be more beneficial for not only consumers, but also the government itself, since they ...
175 views

### How can 1 BTC gain value in USD if inflation is happening?

So, right now, 1 BTC (bitcoin) is worth ≈ 578.25 USD. But, with the inflation of the USD, how can 1 BTC still hold its value at 578.25? Why doesn't it decrease? Let's set this example: 1 BTC = 1 USD....
50 views

### Find change in gross profit after price change

How do you solve this question? A company has 3 products. They contribute to 30%, 30% and 40% of sales respectively. They have profit margins of 15%, 30%, and 50% respectively. If the ...
293 views

### What is autocorrelation of prices?

In my econometrics and economics classes, the term autocorrelation has come up this quarter. I have read the Wikipedia pages about it and tried to understand them, but they are a bit beyond me. They ...
82 views

### How to measure home value distribution in a city? [closed]

I would like to know how I can measure and compare the distributions of home values across cities. I have collected the following data for each city: a) median price in the city; b) number of ...