A manufacturer of sunglasses is currently selling glasses for $15
a pair. Given the price p
and the demand x
for these glasses
x=f(p)=9500−250p
relation is given. Accordingly, if price increases, does income increase or decrease? Is demand elastic?
a.
Demand is elastic. If the price increases, revenue increases.
b.
Demand is elastic. If the price increases, revenue increases.
c.
Demand is inelastic. If the price increases, revenue decreases.
d.
Demand is inelastic. If the price increases, revenue increases.