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QUESTION
To increase revenue and profit, a firm is considering a 4% increase and an 11% increase in advertising. If the price elasticity of demand is -1.5...
1. To increase revenue and profit, a firm is considering a 4% increase and an 11% increase in advertising. If the price elasticity of demand is -1.5 and the advertising elasticity of demand is +0.6, would you expect an increase or decrease in total revenue? Explain.
