a) As an economist in a large company selling electrical appliances, you consider a policy to reduce the selling price of electrical appliances hoping that there will be an increase in the quantity of appliances sold, leading to an increase in total revenue. You know that the price elasticity of demand is -1. Will you opt for this pricing policy?.
b) A depreciation in the value of the Japanese currency in relation to the US dollar does not allow the Japanese firms to sell more in the USA market'. Do you agree with this statement? Discuss your answer.