Question: Suppose a research report has estimated the demand for a firm's product as ln Q X d = 7 1.5 ln P X + 2

Suppose a research report has estimated the demand for a firm's product as ln Q_X^d = 7 1.5 ln P_X + 2 ln P_Y 0.5 ln M + ln A where: P_x = $15 P_y = $6 M = $40,000, and A = $350

a. Determine the own price elasticity of demand, and state whether demand is elastic, inelastic, or unitary elastic.

Own price elasticity:

Demand is: (Click to select) inelastic elastic unitary elastic .

b. Determine the cross-price elasticity of demand between good X and good Y, and state whether these two goods are substitutes or complements.

Cross-price elasticity:

These two goods are: (Click to select) substitutes complements .

c. Determine the income elasticity of demand, and state whether good X is a normal or inferior good.

Income elasticity:

Good X is: (Click to select) inferior normal .

d. Determine the own advertising elasticity of demand.

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