2. (a) As long as a prescription drug is under patent, the company has a monopoly, and no one can copy the drug. When the patent expires, generic manufacturers can copy the drug legally. What impact does the patent expiry have on the price elasticity of demand for the drug? Please give an explanation.

(b) You are told that the price elasticity of demand for Google Play apps is - 3.7. If price of the apps rises by 5 percent would revenue rise or fall? Please explain and show all calculations.

3.