1b. What is the elasticity of demand for beef between price $9 and $11? Is demand for beef, elastic, inelastic or unit elastic? Why?
2. The producer of X is contemplating a price change and has asked
for your advice. After some empirical investigation, you conclude that
the price elasticity of demand for X is 1.25. As an economist, what
would you advise the producer to do in order to raise total revenue?
Would you advise him to raise prices or lower prices of good x?
Why? Explain.