sing regression analysis on data from a field experiment, the demand curve for a product is estimated to be QXd = 1,200 − 3PX − 0.1PZ where Pz = $300. What is the own price elasticity of demand when Px = $240? Is demand elastic or inelastic at this price? What would happen to the firm’s revenue if it decided to charge a price above $240? Enter your response rounded to one decimal place. Own price elasticity: Demand is: . If the firm prices above $240, revenue will:
Using regression analysis on data from a field experiment, the
What is the own
Enter your response rounded to one decimal place.
Own price elasticity:
Demand is: .
If the firm prices above $240, revenue will:
The price elasticity of demand measures the responsiveness of change in quantity demand when the price changes. IN other words, it shows how much the quantity demand changes, when the price of a good changes.
The cross price elasticity shows whether a good is substitute or complement. It shows how much the quantity of good x changes, when the price of good y changes.
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