Spooky Halloween Stores' marketing analytics group has estimated the following elasticities for the retailer's witch costume, fake nose, and Superman costume: Price elasticities of demand (in absolute value terms): Witch costume: 5.1, Fake nose: 3.0, Superwoman costume: 7.5 Cross price elasticities of demand: Of the witch costume with respect to the price of the Superwoman costume: 1.5, Of the witch costume with respect to the price of the fake nose: -0.5. Income elasticity of demand: Witch costume: 0.5, Fake nose: 1. Superwoman costume: 1.2. If you increase the price of the Superwoman costume by 2%, what is your estimate of the percentage change in the volume of the Superwoman costumes sold ?

Answer rating: 100% (QA)

Price Elasticity of Demand PED We know the price elasticity of demand for Superwoman costumes is 75 ... View the full answer