In the application Aggregating the Demand for Broadband Service (based on Duffy-Deno, 2003), the demand function is
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In the application "Aggregating the Demand for Broadband Service" (based on Duffy-Deno, 2003), the demand function is Qs = 5.97p-0.563 for small firms and Ql = 8.77p-0.296 for larger ones. As the graph in the application shows, the two demand functions cross. What are the elasticities of demand for small and large firms where they cross? Explain.
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The price elasticity of demand is thepercentage change in the quantity demand...View the full answer
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