B Q P (S/pack 18(1000s of packs/day b. Use the formula: elasticity =(P/Q)(1/slope). When P=3, Q=9 and 1/slope is 3 So elasticity =3(3/9)=1.0 c If the price increases from $3 to $4, revenue will fall from $27,000 to $24,000 d Using the same formula as in b, elasticity=(2/12)X(3)=0.5 e If the price increases from $2 to $3, revenue will rise from $24,000 to $27,000 3. To maximize revenue from the sale of tickets price should be set at the midpoint of he demand curve, p=$6/visitP Q 100 75 50 25 25 50 75 100 A B C D E 2. a. P ($/pack) Q (1000s of packs/day 6 9 18 3 b. Use the formula: elasticity = (P/Q) (1/slope). When P = 3, Q = 9 and 1/slope is 3. So elasticity = 3(3/9) = 1.0. c. If the price increases from $3 to $4, revenue will fall from $27,000 to $24,000. d. Using the same formula as in b, elasticity = (2/12)x(3) = 0.5. e. If the price increases from $2 to $3, revenue will rise from $24,000 to $27,000. 3. To maximize revenue from the sale of tickets price should be set at the midpoint of the demand curve, p = $6/visit