Suppose the Demand Function for the Toyota Camry Is Given

question 66

Essay

Suppose the demand function for the Toyota Camry is given by Q_d = 500 - 12P_C + 10P_H - 5P_G + 0.0001M,where P_C is the price of the Toyota Camry (in thousands),P_H is the price of the Honda Accord (in thousands),P_G is the price of gas (per gallon)and M is income.Further,suppose the supply curve for the Toyota Camry is given by Qs = 20P_C - 55.
a.What is the demand curve for the Toyota Camry if the price of the Accord is $25,000,gas is $2 per gallon and income is $50,000?
b.What is the equilibrium price and quantity in the market for Toyota Camrys?
c.Is demand elastic or inelastic at the equilibrium price?
d.What is the cross price elasticity of demand between Camrys and Accords at equilibrium?
e.What is the income elasticity of demand for Camrys at equilibrium?

---

Definitions:

Spastic Cerebral Palsy

A form of cerebral palsy characterized by stiff and difficult movement due to muscle tightness and spasms, resulting from brain damage.

Hypertonicity

A condition where there is a higher concentration of solutes outside a cell than inside, leading to cell shrinkage due to water loss.

Coordinated Motion

The ability of different parts of the body to move in a synchronized and efficient manner, often essential for performing complex physical activities.

Myelomeningocele Sac

A spinal defect present at birth where the backbone and spinal canal do not close before birth, leading to a sac protruding through the back.