Question:
Price Elasticity of Demand and Revenue
Fine 0 10 20 30 40 50
Number of Tickets 0 8 7 6 4 2
Total Revenue
a. Plot the demand curve i.e., Qd = F (p)
b. Use the data in table above to find the total revenue for each fine.
SHOW the formula for total revenue.
c. Draw a graph of the relationship between Fines and Revenues [R = f(F)].
d. What does the graph show about the inelastic and elastic portions of the demand curve for tickets.
e. How is the graph in part (c) above as an example of a Laffer Curve.