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The Sandy Deli Operates near a College Campus

Question 222

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The Sandy Deli operates near a college campus.It has been selling 325 sandwiches a day at $1.75 each and is considering a price cut.It estimates 450 sandwiches would sell per day at $1.50 each.Calculate the marginal revenue of such a price cut and the elasticity between the two points.

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Revenue is currently 325 × $1.75 = $568....

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