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10 . Individual Problems 6-3 An end-of-aisle price promotion changes the price elasticity of a good from 2 to 3. Suppose the normal price is

10 . Individual Problems 6-3

An end-of-aisle price promotion changes the price elasticity of a good from 2 to 3. Suppose the normal price is $12, which equates marginal revenue with marginal cost at the initial elasticity of -2.

What should the promotional price be when the elasticity changes to -3? (Hint: In other words, what price will equate marginal revenue and marginal cost?)

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