Think of a good that you have purchased recently. Be specific (example: Is it breakfast cereal in general or Cheerios cereal specifically).
Question 1. If the price of this item increases, how would this affect the quantity of the good that you consume?
Question 2. Is the demand for this good price elastic or price inelastic? Justify your classification by talking about the determinants of elasticity as they apply to this product.
Question 3. Say price is on the rise for this product and you are the manager of a store, would you be thrilled to be selling this product? Under what circumstances would you want to own a business that sells this product? In other words, how dozs an increase in price for this good affect your Total Revenue?
Question 4. Using specific examples, relate the concepts of Cross Elasticity and Income Elasticity to this product.