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? Revenue change: $ -3.66 -3.66 Incorrect Demand is elastic Correct 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? Revenue change: $ 20 20 Incorrect Demand is inelastic Correct 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? Price that maximizes total revenues: $ 7 7 Correct Demand is unitary elastic Correct at this point

Answer rating: 100% (QA)

Solution a When P 12 R 121 12 When P 10 R 102 20 Thusthe price decrease result... View the full answer