Reply
Sat 20 May, 2017 11:42 am
Hey guys can you help me. The following demand function has been estimated for Fantasy Pinball machines:
QD = 3,500 – 40P + 17.5Px + 670U + 9A + 6,500N
Where P = monthly rental price of Fantasy Pinball machines
Px = monthly rental price of Old Chicago pinball machines (a competitor) U = current unemployment rate in the 10 largest metropolitan areas A = advertising expenditures for Fantasy Pinball machines in thousands of dollars N = fraction of the US population between 10 and 30
a) What is the point elasticity of demand with respect to Fantasy Pinball machines when P = $150, Px= $100, U=0.12, A = $200,000 and N = .35?