Home internet firm has estimated the demand for its service to be given by the following function:

Q = 2000 - 11.7 P+ 2.5 A + 1.6 Y - 1.4 PZ

where

Q = monthly sales in units

P = price of the service in $

A= promotional expenditure in $'000

Y = average income of the market in $'000

PZ = price of 'Wireless internet router' in $

The current price of this home internet firm is $60, promotional expenditure is $120,000, the average income is $28,000, and the price of 'Wireless internet router'' is $45.

Indicate whether the following statements are true or false, giving your reasons and making the necessary corrections.

1-People's expenditure on the internet service as a proportion of their income will increase

2- The firm's sales are more affected by the price ''Wireless internet router''' than by the price of its own service.

3-If the firm increases its price, this will reduce its profit.