2 - Question 11 (1 point)

A firm has estimated the following demand function for its product: Q = 58 - 2P + 0.10I + 15A where Q is Quantity Demanded per month in thousands, P is product price, I is an index of consumer income, and A is advertising expenditures per month in thousands. Assume that P = $10, I = 120, and A = 10. If so, then the price elasticity of demand is

Question 11 options:

a)

-1.20

b)

-0.10

c)

-0.40

d)

-2.50