The demand function for drangles is q(p) = (p + 1)−2.
(a) What is the price elasticity of demand at price p? −2p/(p+1).
(b) At what price is the price elasticity of demand for drangles equal to −1?
(c) Write an expression for total revenue from the sale of drangles as a function of their price. ______________. Use calculus to find the revenue-maximizing price. Don’t forget to check the second-order condition. ______________.
(d) Suppose that the demand function for drangles takes the more general form q(p) = (p+a)−b where a > 0 and b > 1. Calculate an expression for the price elasticity of demand at price p. _______. At what price is the price elasticity of demand equal to −1? ________.