LO 12.4: I can determine and discuss the application of elasticity in a given scenario. Worldwide annual sales of smartphones in 2012-2013 were approximately q = -6p + 3,030 million phones at a selling price of $p per phone. In 2013 the actual selling price was $321 per phone. At that price level, the price elasticity of demand, E = 1.74. What does that value mean? The demand is inelastic, and the revenue will rise. The demand is elastic, and the revenue will fall. The maximum revenue is 1.74 million dollars. The demand is neither elastic nor elastic and the revenue will stay the same.
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