QUESTION 4:Marry'M has developed a new product. The market demand for the productgiven as :QD = 240 - 4P%3D1. If the product is priced at $40, estimate the price elasticity of demand? Isdemand elastic or inelastic?2. If the product price is increased slightly from $40, what will happen to thetotal expenditure on the product? (explain with curve)Multiple choice1. Suppose you have bought and paid for a ticket to see Kanye in concert. You werewilling to pay up to $350 for this ticket, but it only cost you $100. On the day of theconcert, a friend offers you a free ticket to Lady Gaga instead. You can resell yourKanye ticket for $80. What do your sunk costs equal?

Given: Demand function: QD = 240 - 4P

QUESTION 4: Marry'M has developed a new product. The market demand for the product given as : QD = 240 - 4P %3D 1. If the product is priced at $40, estimate the price elasticity of demand? Is demand elastic or inelastic? If the product price is increased slightly from $40, what will happen to the total expenditure on the product? (explain with curve) 2.

QUESTION 4: Marry'M has developed a new product. The market demand for the product given as : QD = 240 - 4P %3D 1. If the product is priced at $40, estimate the price elasticity of demand? Is demand elastic or inelastic? If the product price is increased slightly from $40, what will happen to the total expenditure on the product? (explain with curve) 2.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter5: Income And Substitution Effects

Section: Chapter Questions

Problem 5.9P

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