the ABC marketing consulting firm found that a particular brand pf portable ster

Question

the ABC marketing consulting firm found that a particular brand pf portable stereo has the following demand curve for a certain region: Q=10,000 - 200 P + 0,03 Pop + 0, 6 I + 0.2 A where is Q the quantity per month, P is price ($), Pop is population, I is disposable income per household(S), and A is advertising expenditure($). a.determine the demand curve for the company in a market in which P=300, Pop= 1,000,000, I=30,000, and A=15,000 b. calculate the quantity demanded at prices of $200, $175, $150, and $125. c. calculate the price necessary to sell 45,000 units.

Explanation / Answer

Hi, Please find answers as follows: Part A: A = 15,000. Q=10000- 200 *(300) + 0.03 (1000000) +0.6(30000) + 0.2(15000) = 1000 If p= 0 then q=10000+30000+18000+3000= 61000 If q= 0 then 200p=1000+30000+18000+3000 Therefore, p=305 Part B Q=10,000 - 200 P + 0.03 Pop + 0.6 I + 0.2 A 210 = 21000 175 = 26000 150 = 31000 125 = 36000 Part C 45000 = 10000- 200 *(p) + 0.03 (1000000) +0.6 (30000) + 0.2 (15000) 61000-200p=45000 p=80 Thanks, Aman

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