Hello, and thanks in advance for your help.

1.Suppose you manage an appliance store. Your firm recently bought a large number of energy efficient refrigerators to stock in the store. Today, the government mandated that every household must have an energy efficient refrigerator by this time next year or they will have to pay a very large fine. You run the numbers, and luckily, even with the increase in demand that will come from the law, your store has enough refrigerators in stock to last the full 12 months until the deadline of the law passes and demand returns to normal. Suppose you are the only appliance store in town, so you do not need to worry about close competitors. The owners of the store trusts you and usually lets you handle all pricing decisions, however, because of the extraordinary circumstances they have asked you to run your pricing plan by them. You show them how you plan to start with the price at around the usual level, but to gradually increase it as the deadline approaches, in order to maximize revenue. Justify this pricing plan based on what we've learned in the course. (Hint: Your answer should be based around elasticity. Will the demand be more or less elastic near the deadline? You should also explain why maximizing revenue is a reasonable approach here, even though we usually think about firms maximizing profit, give an example). References are not required for course material but must be provided when referencing material from outside of our assigned content. I will not require these to be formal, but you should include a link if it's a webpage or a title and author if it's another media source.