Vanity license plates. According to a pricing model, increasing the fee for vanity license plates by $1 decreases the percentage of a state’s population that will request them by 0.04% (Source: E. D. Craft, “The demand for vanity (plates): Elasticities, net revenue maximization, and deadweight loss, “ Contemporary Economic Policy,
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a. Recently, the tee for vanity license plates in Maryland was $25, and the percentage of the state’s population that had vanity plates was 2 13% Use this information to construct the demand function,
b. Find the fee, x, that will maximize revenue from vanity plates
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