A company faces D1 curve for its product. Price on D1 curve decreases from $4 to $3, quantity demanded increases from 6 to 7 units. A) Calculate the price elasticity of demand on D1. Show your work and choose the answer form below. a) -1.8 b). -0.28 c) - 0.5 d) - 2.8 B) Refer to your answer above. The demand on D1 is: a) Perfectly inelastic c) Perfectly elastic b) Inelastic d) Elastic C) Refer to your answer to the question above. If the price on D1 decreases by 10 percent, the quantity demanded _______________ by ______percent, company total revenue__________________ a) decreases; 10%; remains the same b) increases; 5%; falls c) falls; 18%; increases d) increases; 2.8%; falls D) Refer to your answer in part b. If the company from above desires to increase the quantity sold in the market and total revenue by 20 percent, how it should adjust its price? a) decrease price by 20% b) increase price by 20% c) increase price by 40% d) decrease price by 5% E) If the income elasticity of demand for a product is 0.70 a. You can conclude that the product is: Inferior good, income inelastic ( ) Normal, necessity good, income inelastic ( ) Normal luxury good, income elastic ( ) Inferior good, income elastic ( ) b. If consumers' income falls by 10%, market demand for this product ___________ and quantity demanded _______________ by _________ percent