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Question

Find an example (from the internet or any other source) of the price elasticity of demand for a specific

product. For example, a source might say that "The elasticity of demand for product X is -2.5." Document your source, and quote directly from the passage that mentions the price elasticity.

Use the price elasticity in your answer to question 1 to answer the following questions:

2. If the price of the product falls by 5%, what will be the resulting percentage change in the quantity demanded? Show your work.

3. In question 2, does total revenue rise or fall as a result of the 5% price decrease? Explain briefly.

4. If the price of the product rises by 7%, what will be the resulting percentage change in quantity demanded? Show your work.

5. In question 5, does total revenue rise or fall as a result of the 7% price increase? Show your work.

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