1. A pharmaceutical company recently introduced a new drug to the U.S. market. The CEO of this company would like to know more about the demand for this drug. As a health economist who works for this company, you are tasked to find out the price elasticity of this drug, provide expert opinion on pricing for this drug, and forecast the impact of raising prices of this drug on the company's revenue. You have the following data: Drug price in June 2017: $100 per pill, sales in June 500,000 pills. Drug price in July 2017: $101 per pill, sales in July, 490,000 pills.

Based on these data, a) Find out the price elasticity of the demand for this drug (when P=$100).

b) Forecast the sales and revenues for the company when P= $99 and when P=$102.

c) Based on your calculations, what pricing strategy advice will you provide to the CEO (e.g, raise the price, lower the price, or leave the price as is)?