Multiple Choice
The following linear demand specification is estimated for Conlan Enterprises,a price-setting firm: 
where Q is the quantity demanded of the product Conlan Enterprises sells,P is the price of that product,M is income,and 
is the price of a related product.The results of the estimation are presented below: 
Assume that the income is $10,000,the price of the related good is $40,and Conlan chooses to set the price of this product at $30.At the prices and income given above,what is the price elasticity of demand?
A) -0.43
B) -0.86
C) -1.00
D) -1.43
E) -2.40
Correct Answer:
Verified
Correct Answer:
Verified
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