A Manufacturer of Infant Clothes Has Found That the Demand

question 36

Multiple Choice

A manufacturer of infant clothes has found that the demand for its product is given by Q = 100P ^{± 1.25}A^0.5,where P is price and A is advertising expenditures.The price elasticity of demand for these infant clothes is:

• A) -0.8.
• B) -1.25.
• C) -1.0.
• D) -2.5.
• E) -0.5.

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