Suppose that the demand function for jelly beans is Qd = AP-B and the supply function is Qs = CPD, where A, B, C, and Dare all positive numbers.
a. What is the elasticity of demand with respect to changes in A?
b. What is the elasticity of supply with respect to the price?
c. Solve for the equilibrium price as a function of A, B, C, and D.
d. What is the elasticity of the equilibrium price with respect to changes in A?