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Homework Help: Calculus question

  1. Nov 13, 2005 #1
    I have some question on elasticity.
    If the demand function is q=Cp^(-k), where C and k are positive constants.

    a)Find E.
    b)if 0<k<1, what does your answer from part a say about how prices should be set to maximize the revenue?
    c)if k>1, what does your answer from part a say about how prices should be set to maximize the revenue?
    d)if k=1, what does your answer from part a tell you about setting prices to maximize revenue?
    e)is this demand function realistic?

    part a) my answer is E=k
    How do you use part a in answering parts b,c,d,e?
     
  2. jcsd
  3. Nov 14, 2005 #2

    HallsofIvy

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    Science Advisor

    What is the definition of "elasticity"?

    How is that connected to how demand varies?
     
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