The Demand for Fax Machines in Thousands of Units Has

Multiple Choice

The demand for fax machines in thousands of units has been estimated to be Q = 1,000 - 1.5P + 5L,where P is the price of the machines and L is the average cost of a 10-minute midday call from Los Angeles to New York.At a fax machine price of $400 and a phone call cost of $10,the price elasticity of demand for fax machines is:

A) -4.0.
B) -2.50.
C) -0.61.
D) -0.25.
E) -1.33.