Multiple Choice
The management of Local Cinema has estimated the monthly demand for tickets to be lnQ = 22,328 - 0.41 lnP + 0.5 lnM - 0.33 lnA + 100 lnPvcr, where Q = quantity of tickets demanded, P = price per ticket, M = income, A = advertising outlay, and Pvcr = price of a VCR tape rental.It is known that P = $5.50, M = $9,000, A = $900, and Pvcr = $3.00.Determine the own-price elasticity of demand for movie tickets.
A) -0.29.
B) -0.32.
C) -0.39.
D) -0.41.
Correct Answer:
Verified
Correct Answer:
Verified
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