Determine point price elasticity of demand

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Reference no: EM1371397

Q. Demand for DVD rentals at a video store is described by equation: Q= 4,000-500P, where Q denotes number of DVDs rented per week and P is rental price in dollars.

a. Determine point price elasticity of demand at P= $3.00

b. Illustrate what would be new point price elasticity if price were raised to P= $4.50?

c. If profit maximizing price is $4.50, illustrate what is marginal cost of a rental? Please Explain how all work

Reference no: EM1371397

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