Exercise 1 (16 points). Taco Del Mar has completed a study of weekly demand for its tacos in Washington State's regional markets. The study developed the following demand function: Q = 650 1,000P + 0.8191 + EPop + 500R. where Q is the number of tacos sold per store per store per week; A is the level of local advertising expenditure in dollars; Pop is the local population in thousands; and PE is the average taco price of local competitors. For the typical Taco Del Mar outlet. P = $2.50, A = $6,000, Pop = 20, and P, = $2.25 Open the Computer exercise 3Workbook and program the elasticity worksheet (using the appropriate formulas} to answer each of the following: a) Estimate the weekly revenue in dollars for the typical Taco Del Mar (given the above information). [2 points for revenue. 2 points for Q) b) What is the own price elasticity for Taco Del Mar tacos under typical conditions? {2 points) c) Should Taco Del Mar raise its taco prices? Discuss why or why not. (2 points) d} Calculate the advertising elasticity for Taco Del Mar tacos. (2 points) e) Use the advertising elasticity to predict the change in Q (as opposed to the % change in 0) resulting from a 1% increase in advertising expense, holding all other factors constant. (2 points) f} Calculate the current cross price elasticity of local taco competitors. (2 points) g) Are the competitor tacos complements or substitutes? Explain why. {2 points)