Your friend is a talented artist. She has no other employment options, she finds painting effortless, and the cost of materials is low enough that it can be safely ignored. Based on your analysis of market data, you estimate that elasticity of demand for her paintings is given in the displayed table. If your friend wants to maximize her income, what price do you advise her to charge for her paintings? Include a brief explanation. (If you think you can only determine a price range, as opposed to a precise price, give a price range.)
Your friend is a talented artist. She has no other employment options, she finds painting effortless, and the cost of materials is low enough that it can be safely ignored. Based on your analysis of market data, you estimate that elasticity of demand for her paintings is given in the displayed table. If your friend wants to maximize her income, what price do you advise her to charge for her paintings? Include a brief explanation. (If you think you can only determine a price range, as opposed to a precise price, give a price range.)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Your friend is a talented artist. She has no other employment options, she finds painting effortless, and the cost of materials is low enough that it can be safely ignored.
Based on your analysis of market data, you estimate that
If your friend wants to maximize her income, what
Transcribed Image Text:if P below $1,000
if P above $1,000 but below $2,500
if P above $2,500 but below $5,000
if P above $5,000 but below $10,000
if P above $10,000 but below $15,000
if P above $15,000
-0.5
-0.7
-0.9
-1.1
-1.3
-1.5
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