AnalysisVeronica ColemanECON503Dr Erin HuttonJanuary 22, 2014 1. Compute the elasticities for each independent variable. Note: Write down all of your calculations.Combined Effects of ElasticitiesQD=[Constant+%Price]+%Competitor’s Price+%Income+%Advertising+%MicrowavesQD=[-520+ -42500]+20(600)+5.2(5,500)+.20(10,000) +.25(5,000) QD=22,330 (Base Q)P=500 cent (Base P)Competitor’s Price ElasticityThe price of the leading competitor’s product in 600 cent, $6.00QY=Constant+%Price(P)+%Competitor’s Price(PX)QX-520+-42(P)+[20(600)]QX=-520-42P+12000QX=11480-42PDQX=11480-42(500)QX=11480-21000QX=-9520andPX= 1148042- 142QDPX= 273.33- 142QDPX=273.33- 142(22330)PX=273.33-531.67PX=-258.34Therefore,EX=?Q?P x Base PBase QEX=(-9520-22330)*500-258.34-500*22330EX=-31850*500-758.34*22330EX= […]