Scenario 4.4: the Demand Curve for the New Computer Game, Rock and Rock

question 103

Multiple Choice

Scenario 4.4:
The demand curve for the new computer game, Rock and Roll Trivia, is given as follows:
Q = 200 - 5P - .1Pc - .5Pd + .2A - I
where P is the price of the game
Pc is the price of a computer
Pd is the price of a diskette
A is the level of advertising
Q is the level of income
-See the information in Scenario 4.4. Suppose P = 10, Pc = 100, Pd = 2, A = 5, and I = 50. What is the price elasticity of demand?

• A) 0
• B) -5/9
• C) -1
• D) -9/5
• E) none of the above

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Definitions:

Population Standard Deviation

A measure of the dispersion or spread of a set of data points in a population dataset.

Confidence Interval

A range of values, derived from sample data, that is likely to contain the value of an unknown population parameter with a certain level of confidence.

Population Mean

The average of all observations or scores in a population.

Confidence Level

The probability that a confidence interval will contain the true population parameter.