Managerial Economics & Business Strategy 8th Edition by Michael Baye,Jeff Prince

تمرين 6

Answer the following questions based on the accompanying diagram.
a. How much would the firm's revenue change if it lowered price from $12 to $10? Is demand elastic or inelastic in this range?
b. How much would the firm's revenue change if it lowered price from $4 to $2? Is demand elastic or inelastic in this range?
c. ? What price maximizes the firm's total revenues? What is the elasticity of demand at this point on the demand curve?