You own a bakery You notice that the quantity of bread dema.pdf

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You own a bakery. You notice that the quantity of bread demanded rises from 80 units to 140 units when the price of bread falls from $1.20 to $0.80 per unit. 1. Using midpoint formula, find the price elasticity of demand for bread. (1 mark) 2. Explain the meaning of the elasticity number that you have obtained from question 1. (1 mark) 3. If your goal is to maximize your total revenue, explain whether you should increase or decrease the price of your bread. Explain why you would do so. (1 mark).

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