Question

The estimated market demand for good X is 
Q = 8,000 – 25P – 0.12M + 30PG
where Q is the estimated number of units of good X demanded, P is the price of the good, M is income, and PG is the price of related good G. Currently, P = $12, M = $30,000, and PG = $50. Examine the demand function and explain
(a) What you can conclude about the input variables.
(b) If currently P = $12, M = $30,000, and PG = $50, which input variable has the greatest effect on Q? Clearly explain your answer



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  • CreatedAugust 05, 2013
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