var imagesXXlarge = ",,,,,"; var imagesXlarge = "krugmanapecon2e_mod48_fig-01,,,,,,,"; var imagesLarge = "krugmanap2e-ch48-fig-3,krugmanap2e-ch48-fig-2,krugmanap2e-ch48-fig-5,,,,,,,"; var imagesSmall = ",,,,,,"; var imagesMedium = "krugmanap2e-ch48-fig-9,krugmanap2e-ch48-fig-10,,,"; xBookUtils.showAnswers['krugmanapecon2e_mod48_cyu_1a'] = "By the midpoint method, the percent increase in Chelsea’s income is . Similarly, the percent increase in her consumption of music downloads is . Chelsea’s income elasticity of demand for music downloads is therefore ."; xBookUtils.showAnswers['krugmanapecon2e_mod48_cyu_2a'] = "The cross-price elasticity of demand is . Since the cross-price elasticity of demand is positive, the two goods are substitutes."; xBookUtils.showAnswers['krugmanapecon2e_mod48_cyu_3a'] = "By the midpoint method, the percent change in the number of hours of web-design services supplied is . Similarly, the percent change in the price of web-design services is . The price elasticity of supply is . Since elasticity is greater than 1, supply is elastic."; xBookUtils.showAnswers['krugmanapecon2e_mod48_fr_2_rubric'] = "
Rubric for FRQ 2 (5 points)
1 point: 40%/20% = 2
1 point: Elastic
1 point: Horizontal supply curve on correctly labeled graph, as shown in the figure.
1 point: Inputs are readily available.
1 point: When inputs are available to be shifted into or out of production at a low cost, firms can easily expand the quantity of output supplied.
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