Calculate And Interpret The Own Price And Cross Price 545696

Demand estimation: Qxd = 100 – 3Px + 4Py – 0.01M + 2Ax.

where Ax represents the amount of advertising spent on shoe (x), Px is the price of good X, Py is the price of good Y and M is average income. Suppose good X sells at RM25 a pair, good Y sells at RM35, the company utilizes 50 units of advertising, and average consumer income is RM20 000. Calculate and interpret the own price, cross price, and income elasticity of demand.