Demand for a softback managerial economics text is given by Q=20,000-300P. The book is initially priced at $30.
a. Compute the point price elasticity of demand at P= $30.
b. If the objective is to increase total revenue, should the price be increased or decreased? Explain.
c. Compute the arc price elasticity for a price decrease from $30 tp $20.
d. Compute the arc price elasticity for a price decrease from $20 to $15.