Using Excel, Best Paints Estimates the Log- Linear Weekly Demand

question 115

Multiple Choice

Using Excel, Best Paints estimates the log- linear weekly demand function for their gallon sized paints to be ln Q^d = 12.53 - (2.25 × ln P) . If Best Paints increases the price of their gallon sized paints by 5 percent, which of the following will occur?

• A)The quantity will increase by 2.25 percent.
• B)The quantity will increase by 11.25 percent.
• C)The quantity will decrease by 2.25 percent.
• D)The quantity will decrease by 11.25 percent.