Question 3: You are the CEO of TOTAL RECALL, Inc., a monopolist producer of facial oil skin-life extender. You need to determine the advertising budget for next year. The marketing department has provided you with three important items of information: (a) The company is expected to sell $10 million worth of the product; (b) it is estimated that a 1% increase in the advertising budget would increase quantity sold by 0.05%; (c) it is estimated that a 1% increase in the product price would reduce quantity sold by 0.2%. (a) How much money would you allocate for advertising next year? (b) Suppose the marketing department has revised its estimation regarding the demand price elasticity to a 1% increase in price resulting in a reduction of quantity sold of 0.5%. How much money would you allocate to advertising after getting the revised estimate? Why has the optimal advertising expenditure gone down?