3. (5 points) Using regression analysis on data from a field experiment, the demand curve for a product is estimated to be where Pz = $300. (a) What is the own price elasticity of demand when Px = $140? Is demand elastic or inelastic at this price? What would happen to the firm's revenue (increase or decrease) if it decided to charge a price below $140? (b) What is the cross-price elasticity of demand between good X and good Z when Px = $140? Are goods X and Z substitutes or complements? For both (a) and (b) you have to calculate the elasticity at a point on the demand curve. Look at example on page 89-90 of the textbook. 4. (5 points) Recently, Verizon Wireless ran a pricing trial in order to estimate the elasticity of demand for its services. The manager selected three states that were representative of its entire service area and increased prices by 5 percent to customers in those areas. One week later, the number of customers enrolled in Verizon's cellular plans declined 4 percent in those states, while enrollments in states where prices were not increased remained flat. The manager used this information to estimate the own price elasticity of demand and, based on her findings, immediately increased prices in all market areas by 5 percent in an attempt to boost the company's 2020 annual revenues. One year later, the manager was perplexed because Verizon's 2020 annual revenues were 10 percent lower than those in 2019-the price increase apparently led to a reduction in the company's revenues. Did the manager make an error? Please explain