The questions involve you interpreting the model output within your answers.

In this case, the model output consists of;

• the cross price elasticity of demand
• the original and new total revenue

Your discussion should focus on using the simulation output to support the theoretical expectations of your discussion. For instance, you could argue that theoretically you would expect that the total revenue of a firm would increase if the price decreased for a close complementary good. You can test this expectation using the simulation.

Cross price elasticity home page »»
Use the back button to return to the what happens when option »»