Q. (Qx) = 12,000 - 5,000Px + 5I + 500Pc where Px is cost charged for novels, I is income per capita and Pc is cost of books from competing publishers. Illustrate what effect a cost increase would have on total revenues. Evaluate how sale of novels would change during a period of rising incomes. Assess probable impact if competing publishers raise their costs.

Assume that initial values of Px, I and Pc are $5, $ 10,000 and $ 6, respectively