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Song average arc elasticity of demand

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Reference no: EM132279056

When Apple raised the price of iTunes from $.99 to $1.29, GS Boyz's "Stanky Legg" sales dropped from 22,800 units to 19,700 units (Glenn Peoples, "iTunes Price Change: Sales Down, Revenue Up in Week 1," Billboard, April 5, 2009). What was the song's average arc elasticity of demand? Should Apple raise the price for this download even more? Why or why not?

Reference no: EM132279056

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