Answer the following questions based on the accompanying diagram: Price (\$) Instructions: All dollar responses should be entered as whole numbers. Include a minus (-) sign for all negative answers. a. How much would the firm's revenue change if it lowered price from $12 to $8 ? Is demand elastic or inelastic in this range? Revenue change: $ Demand is in this range. b. How much would the firm's revenue change if it lowered price from $4 to $2 ? Is demand elastic or inelastic in this range? Revenue change: $ Demand is in this range. c. What price maximizes the firm's total revenues? What is the elasticity of demand at this point on the demand curve? Price that maximizes total revenues: $ Demand is at this point
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