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Suppose the demand curve for new computer game, Starcraft II: Legacy of the Void, is given...

Suppose the demand curve for new computer game, Starcraft II: Legacy of the Void, is given as follows:

where P= price of game

Pc is the price of a computer

Pd is the price of diskette

A is the level of advertising

I is the level of income

Q= 200- 5P- .01Pc-.5Pd+.2A-I

1. Suppose P= 10, Pc=100, Pd=2, A= 5 and I=50. How many games will be sold? What is the price elasticity of demand?

2. Suppose the price should increase slightly from $10. How will the total expenditure of consumers on the game be affected?

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