7. The demand function for a product is given by q = 250-0.5p. a. Determine the price levels for which the demand is elastic. b. What do you learn from your answer to a. about the revenue? c. Find the price levels for which demand is perfectly inelastic. d. Determine the point elasticity of demand when p = 200 and classify the demand as (perfectly) elastic, (perfectly) inelastic or of unit elasticity at this price level. e. Use your answer to d. to estimate the percentage change in quantity sold when the price is lowered from 200 to 197. f. Will the changes in e. result in an increase or decrease in revenue? Explain based on your answer to d. Estimate the change in revenue, using the value for the point elasticity you found in d.

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