Applying a uniform markup to set the price of the various products sold by a firm is more profitable than varying the markup based on differences in the price elasticity of demand for the firm's products.

Question

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Varying the markup based on differences in price elasticity of demand allows the firm to charge higher prices for products with inelastic demand and lower prices for products with elastic demand, which can lead to greater profits overall. Applying a uniform markup may not take into account the different levels of demand for each product and could result in missed opportunities to charge higher prices for certain products.

Applying a Uniform Markup to Set the Price of the Various