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Before a company started selling a new digital camera, its marketing team surveyed consumers regarding whether or not they would consider buying the camera at
Before a company started selling a new digital camera, its marketing team surveyed consumers regarding whether or not they would consider buying the camera at different price levels. The table lists their estimates for the number of cameras that will sell at a particular price. (Let q represent the units sold in thousands.) Units sold Price (thousands) $125 $150 $175 200 $225 51.6 43.3 37.9 31.7 25.3 (a) Use a graphing calculator to find an exponential model of the demand function p D(q) for the camera. (Give your numerical values to three decimal places.) D(4) (b) Use the model to ostimate now many cameras will sell if the camera is priced at $189. (Round Your answer to the ncarest integer (c) According to your model, what is the elasticity of demand at the $189 price point? (Round your answer to two decimal places) Does your answer suggest that the camera should he priced higher or lower? The camera should be priced higher The camera should be priced lower (d) Compute the total revenue using the values in the table. Then estimate the camera price that will bring in the most revenue. (e) Use elasticity to rind the price for the camera that will bring the greatest revenue. How does it copare to your estimate in part (d)? (Round your answer to two decimal places.)
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