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Initial values are: PM = $20000 Pc =$1.00 I= $15000 A = $10000 This function is: QT = 200 -.01PT +.005PM -10Pc +.01I +.003A 2.(a)

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Initial values are: PM = $20000 Pc =$1.00 I= $15000 A = $10000 This function is: QT = 200 -.01PT +.005PM -10Pc +.01I +.003A 2.(a) Calculate the point price elasticity of demand for Toyotas at PT= $20000 (which should make QT = 270). Other variables and their values are given at the top, before question #1. The formula is: Ep 3QT PT aPT QT (b). Does this elasticity indicate that Toyota demand is relatively responsive to changes in Toyota price? Explain why or why not

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