The Demand Function for a Certain Make of Exercise Bicycle

question 95

Multiple Choice

The demand function for a certain make of exercise bicycle sold exclusively through cable television is , where p is the unit price in hundreds of dollars and x is the quantity demanded/week. ​
Compute the elasticity of demand and determine the range of prices corresponding to inelastic, unitary, and elastic demand.
​

• A) ; for demand is inelastic; for demand is unitary; for demand is elastic
• B) ​ ; for demand is inelastic; for demand is unitary; for demand is elastic​
• C) ​ ; for demand is inelastic; for demand is unitary; for demand is elastic​
• D) ​ ; for demand is inelastic; for demand is unitary; for demand is elastic​

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Definitions:

Intra-entity Gross Profit

The profit recorded from transactions that occur within the same entity, often eliminated in consolidation.

Eliminate Intra-entity Transfer

The process of removing sales and purchases of goods or services made between companies within the same corporate group in consolidated financial statements.