Demand curve for product-demand elastic or inelastic

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The demand curve for a product is given by P = 400 - 1Q/3.

a. What is the own price elasticity of demand when price is $100? Is demand elastic or inelastic at this price? What would happen to the firm’s revenue if it decided to charge a price above $100?

b. What is the own price elasticity of demand when price is $300? Is demand elastic or inelastic at this price? What would happen to the firm’s revenue if it decided to charge a price below $300?

c. What price should you charge in order to maximize the firm’s revenue?

Reference no: EM13698889

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