If the marginal revenue from a product is $15 and the price elasticity of demand is−1.2, what is the price of the product?
The demand function for bicycles in Holland has been estimated to be
Q = 2,000 +15Y -5.5P
Where Y is income in thousands of euros, Q is the quantity demanded in units, and P is the price per unit. When P = 150 euros and Y = 15(000) euros, determine the following:
a. Price elasticity of demand
b. Income elasticity of demand