Thus , it is a measure of how much money a company makes from selling its product . The core
objective of a firm is maximizing profit . One of the ways to maximize profit is increasing total revenue .
The firm can increase its total revenue by selling more items or by raising the price . Among others ,
this depends on the nature of the price elasticity of demand . Moreover , the length of time is an
important factor in determining price elasticity of demand and supply . Course outcome ( s ) practiced and assessed in this Assignment :
GB540-1 : Examine microeconomic tools for purposes of problem solving , analysis , and decisionmaking .
Directions
● Explain the relationship between the price elasticity of demand and total revenue . What are the
impacts of various forms of elasticities ( elastic , inelastic , unit elastic , etc .) on business
decisions and strategies to maximize profit ? You can explain your responses using empirical
examples , formulas and graphs .
● Is the price elasticity of demand or supply more elastic over a shorter or a longer period of
time ? Why ? Give examples .