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Question 2 2. If the demand function for a particular product to be given by the following function: QD = 6,000 - 0.5P - Py + 24 + 0.1M Where : QD. = monthly sales in units Pr = price of the product x in $ Py =price of product y in $ A = promotional expenditure M= average income of the market in $ 1,000 The current price of product x is $60, promotional expenditure is $1,200, average income is $28,000, and the price of product y is $45. Indicate whether the following statements are true or false, giving your reasons and making the necessary corrections : a. If the price of product y increases, this will reduce the sales of product x b. If the price of product x increases, this will reduce its revenues. c. People's expenditure on product x will increase when their income increases. e. Product y is a substitute for product x f. A 10 per cent increase in income will increase demand of product x by 2.5 per cent. g. A 10 per cent increase in price of product x will reduce demand of product x by 12 per cent