4.(a). Competition might be a worry for Toyota. PM = the price of Mazadas. Calculate the point Mazada cross-price elasticity of demand with PM = $20000 and PT = $20000 (which should make Qr = 270). Other variables are given at the top before question #1. The formula is: QT Pm dPm Qr ETM = (b). Does this elasticity indicate that the demand for Toyotas is relatively responsive to changes in the price of Mazadas? Explain why or why not.
4.(a). Competition might be a worry for Toyota. PM = the price of Mazadas. Calculate the point Mazada cross-price elasticity of demand with PM = $20000 and PT = $20000 (which should make Qr = 270). Other variables are given at the top before question #1. The formula is: QT Pm dPm Qr ETM = (b). Does this elasticity indicate that the demand for Toyotas is relatively responsive to changes in the price of Mazadas? Explain why or why not.
Principles of Microeconomics
7th Edition
ISBN:9781305156050
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter5: Elastic And Its Application
Section: Chapter Questions
Problem 6PA: Suppose that your demand schedule for DVDs is as follows: Price Quantity Demanded (income = 10,000)...
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Initial values are: PM = $20000 PG = $1.00 I = $15000 A = $10000
This function is: QT = 200 -.01PT +.005PM -10PG +.01I +.003A
please Answer from 4 to 5 complete
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5.(a). Calculate the point advertising
(b). Does this elasticity indicate that demand for Toyotas is very responsive to changes in advertising expenditures (thus suggesting that advertising is a very important way to increase sales)? Explain why or why not.
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