Variable denitions are the same as those given in class. (a) Find an expression for (change in)TR/(change in)Q as a function
of the price elasticity of demand, Ep, and price P. The term (change in)TR/(change in)Q is called marginal revenue, which is defined
as the extra revenue one obtains from increasing the quantity sold, Q. (b) Use your answer in part (a) to
show under what range of values of Ep the marginal revenue is positive.
of the price elasticity of demand, Ep, and price P. The term (change in)TR/(change in)Q is called marginal revenue, which is defined
as the extra revenue one obtains from increasing the quantity sold, Q. (b) Use your answer in part (a) to
show under what range of values of Ep the marginal revenue is positive.