Problem on toy prices and total revenues
Question: Your firm's research department has estimated the elasticity of demand for toys to be -0.7. As the manager of the firm, determine the impact of an 8 percent increase in toy prices on your total revenues.
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Q1. What should you do with your stock of inventories? Q2. What do you expect to happen to your sales?
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Determine the impact of an 8 percent increase in toy prices on your total revenues.
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