32. What is the condition on (the absolute value of) own price elasticity that ensures a...
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32. What is the condition on (the absolute value of) own price elasticity that ensures a firm's revenues, R, will increase as it increases its price? Hint: Follow these steps: Note that RpD ( ) Find the mathematical condition that implies revenue is increasing in price. Make sure you perform the Chain Rule correctly. Remember that D(p) = 9 and D'p) = aq ap "Look for" own price elasticity in your mathematical condition. A. xq 01 B. E | 1 XP1 |=1 C. k1 32. What is the condition on (the absolute value of) own price elasticity that ensures a firm's revenues, R, will increase as it increases its price? Hint: Follow these steps: Note that RpD ( ) Find the mathematical condition that implies revenue is increasing in price. Make sure you perform the Chain Rule correctly. Remember that D(p) = 9 and D'p) = aq ap "Look for" own price elasticity in your mathematical condition. A. xq 01 B. E | 1 XP1 |=1 C. k1
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Microeconomics An Intuitive Approach with Calculus
ISBN: 978-0538453257
1st edition
Authors: Thomas Nechyba
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