For each of the following events, state the relevant elasticity concept. Then      compute the measure of elasticity using averages prices...

For each of the following events, state the relevant elasticity concept. Then      compute the measure of elasticity using averages prices and quantities in your calculations. In all cases, assume that these are ceteris paribus changes. Value = 10 points each. Show your calculations.

a)      Due to the recent hurricanes in the United States lumber prices have increased by 14 per cent. Annual Canadian production of limber  increases from 8 million broad feet to 11 million broad feet

b)      After a major crop failure for strawberries, price of strawberry jam increase from $4.00 per kilogram to $5.80 per kilogram. The sales of peanut jam increased from 8000 kg per month to 8500 kg per month.

c)       When the price of a ticket to a Saint Mary’s football game is reduced from $16.00 to $13.00, ticket sales increase from 1200 to 1350.

d)      When price of basic telephone services increases from $0.10 per minute to $0.12 per minute and the total number minutes per month falls from 200 minutes to 190 minutes.

e)      An average household increase in Nova Scotia increases by 10 per cent, annual sales of new trucks increase from 56,000 to 67,000.

Question Two Value = 50

In each of the events in question one (above question) use the estimated elasticity to help explain the marketing conditions of the product or products (future sales, how does the product/s  sales react to price changes). In other words, what does it mean (explain) if the elasticity is elastic /inelastic or cross elasticity, normal good for the income elasticity. Treat each event separately. Value = 10 points each.