Question

You are the newly appointed sales manager of the Rock Computer Tablets Company and have been charged with the task of increasing revenues. Your economics consultants have informed you that at present price and output levels, price elasticity of demand for your product is less than one. You should __________.

Answer 1

I should increase prices and thus increase revenues.

Step-by-step explanation:

In the case of this company, the price elasticity of the demand for its product is less than one, which indicates that it is an inelastic demand. Therefore, depending on the elasticity in order to increase its income, we must increase prices so that this change can be achieved.