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The elasticity of demand for a firm's product is 2 and its advertising elasticity of demand is 0.3. a. Determine the firm's optimal advertising-to-sales ratio.

The elasticity of demand for a firm's product is 2 and its advertising elasticity of demand is 0.3.

a. Determine the firm's optimal advertising-to-sales ratio.

Instruction: Enter your response rounded to two decimal places.

b. If the firm's revenues are $50,000, what is its profit-maximizing level of advertising?

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