Mead Plumbing currently sells thread seal tape at a price of $42.00 per roll. Their research department has derived the price-demand equation as p = 60 - 0.02x where x is the number of tapes that can be sold at Sp per roll of tape. (a) Express the demandx as a function of price p. Find the domain of this function. (b) Find the elasticity of demand, E(p), in reduced form. (c) If Mead Plumbing decides to increase their current price, would their revenue increase or decrease? Explain how you arrived at your answer.

Mead Plumbing currently sells thread seal tape at a price of $42.00 per roll. Their research department has derived the price-demand equation as p = 60 - 0.02x where x is the number of tapes that can be sold at Sp per roll of tape. (a) Express the demandx as a function of price p. Find the domain of this function. (b) Find the elasticity of demand, E(p), in reduced form. (c) If Mead Plumbing decides to increase their current price, would their revenue increase or decrease? Explain how you arrived at your answer.

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter5: Elasticity Of Demand And Supply

Section: Chapter Questions

Problem 1.1P: (Calculating Price Elasticity of Demand) Suppose that 50 units of a good are demanded at a price of...

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