Question
The elasticity of demand for a firm's product is -2.5 and its advertising elasticity of demand is 0.25. a. Determine the firm's optimal advertising-to-sales ratio.
The elasticity of demand for a firm's product is -2.5 and its advertising elasticity of demand is 0.25.
a. Determine the firm's optimal advertising-to-sales ratio.
b. If the firm's revenues are $60,000, what is its profit-maximizing level of advertising?
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American Political Economy In Global Perspective
Authors: Harold L Wilensky
1st Edition
1139227920, 9781139227926
