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References

Suppose a research report has estimated the demand for a firm's product as In Qxd=7-1.5 In Px+2 In Py-0.5 In M+In A where:

Px=$15

Py=$6

M = $40,000, and

A = $350

a. Determine the own price elasticity of demand, and state whether demand is elastic, inelastic, or unitary elastic.

Own price elasticity: [

Demand is: (Click to select)

b. Determine the cross-price elasticity of demand between good X and good Y, and state whether these two goods are substitutes or

complements.

Cross-price elasticity:[

These two goods are: (Click to select)

c. Determine the income elasticity of demand, and state whether good X is a normal or inferior good.

Income elasticity:

Good X is: (Click to select)

d. Determine the own advertising elasticity of demand.