Question: Canabec Satellite Communications Ltd. (CSC) is a newly established company which plans to introduce wireless interactive television broadcasting
and cable services to households in Canada. Essentially, subscribers lease a satellite dish with a reception device that they can hook up to
their tv set and then the company beams down via a satellite a whole package of channels. Having commissioned a econometric study of the demand for satellite communications services, the economic and management consultants of the firm have estimated the following demand equation:

Q= 70,000 - 4,000P + 90I + .07N

Where Q= Number of satellite com subscribers
P= Annual fee
I= Annual household income in dollars
N= Number of households

The economic consultant has pointed out that once the satellite dish is installed a a modest, one-time cost to the subscriber, there is no other monthly
cost associated with the service other than the monthly billing cost which can be considered non-material fot the purposes of this exercise. Most other expenses are independent
of the number of subscribers.

a) Find the total number of subscribers if the price P=800, I=47,000. , N=10 000 000.

b) Find the equation for the demand curve for sat-com services and plot the demand curve.

c) The firm's goal is to maximize sales revenue. What price would you recommend they charge for sat-com services? How many subscribers can CSC expect to attract at that price?
What sales revenue can the firm expect each year?

d) Using the diagrams, illustrate on one the demand and marginal revenue curves and on the other, the total revenue curve. Indicate the values of P,Q, TR and MR at the point where
sales revenue maximization occurs.

e) Using calculus, calculate the price elasticity of demand at each of the following prices: $800 ,$625, $450. Which of the three prices would you recommend to achieve sales revenue maximization?

f) Over the next 5 years, the average income per household is projected to rise by 10% while the number of households are expected to rise by 5%. Assuming that the price of sat-com services remains constant, forecast the total number of subscribers 5 years from now. Use the price you have recommended in c) (above)