Question: 4. Given the estimated demand function for good 1: Q1 = 504P1 3.2P2 + 0.01), where P; and P2 are prices for good 1 and

4. Given the estimated demand function for good 1: Q1 = 504P1 3.2P2 + 0.01)", where P; and P2 are prices for good 1 and 2, respectively, and Y is income. (a) (2 points) Are good 1 and good 2 complements or substitutes? Why? (b) (3 points) Calculate the cross-price elasticity of demand for good 1, with respect to the price ofgood 2, given P1 : $1.20, P2 : 3.50, and Y: $15,000

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