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QUESTION 2 Toyota Vios is facing stiff competition from Honda City, the two types of cars within the same range. The management of UMW Toyota

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QUESTION 2 Toyota Vios is facing stiff competition from Honda City, the two types of cars within the same range. The management of UMW Toyota Motor is planning to review its strategy to boost the sales volume of Toyota Vios. In response to this, the Marketing Manager has conducted a study and developed a linear demand model for Toyota Vios sale as follows: Qa = 150 + 4Py - 3Px + .01M + 2Ax The variables used in the model include the price of Honda City (Py), price of Toyota Vios (Px), average income of consumers (M) and promotional expenses (Ax). Suppose Toyota Vios sells at RM90 thousands per unit, Honda City sells at RM95 thousand per units

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