The ABC marketing consulting firm found that a particular brand of musical device has the following demand function:

Q_md^d = 10,000 - 200P + 0.03Pop + 0.6M + 0.2A

where Q_md^d = quantity of musical devices demanded, P = own-price of a musical device, Pop = population, M = disposable household income, and A = own-advertising expenditure. Assume that P = $300, Pop = 1,000,000, M = $30,000, and A = $15,000.

a. Calculate the own-advertising elasticity of demand. (4 points)

b. Obtain the demand function. (2 points)

c. Suppose that the supply function for musical devices is Q_md^s = 21,000 + 300Pand calculate the equilibrium price and equilibrium quantity. (4 points)