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a) Assume that for a product over the price range from $0.40 to $0.50, the relationship between sales and price follows the constant elasticity response

a) Assume that for a product over the price range from $0.40 to $0.50, the relationship between sales and price follows the constant elasticity response model:

Sales = 120 x price ^-0.8

Estimate the sales and price elasticity at $0.44.

b) Assume that for a product over the price range from $0.70 to $0.80, the relationship between sales and price follows the logit response model:

1500 x 1 + exp (1.2 2.3 x price) -

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