- #1

DreamBell

P=monthly rental price of XY machine

Px= monthly rental price of old town XY machine (Largest competitor)

U = current unemployment rate in the 10 largest metropolitan areas.

A=Advertising expenditures for XY machine

N=fraction of the Singapore population btw ages 10 to 30

Question

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1. What is the point price elasticity of demand for XY when P=$150, Px=$100, U=0.12, A=$200000 and N=0.35.

2. what is the point cross e;asticity of demand with respect to XY machine for values of the independent variables given in part 1.