Determine the income elasticity of demand

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Suppose the demand function for a firm's product is given by Q=200-10Px-50Py+0.01M+0.4AwherePx =$10,Py =$4,M=$20,000,andA=$250. a. Determine the own price elasticity of demand, and state whether demand is elastic, inelastic, or 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. c. Determine the income elasticity of demand, and state whether good X is a normal or inferior good. d. Determine the own advertising elasticity of demand.

Reference no: EM13149358

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