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If a firm faces price-inelastic demand for its products, and can therefore raise its price and increase its total revenue, should it generally do so?
If a firm faces price-inelastic demand for its products, and can therefore raise its price and increase its total revenue, should it generally do so? Why or why not? When is it OK? When isn't it OK? Explain your answer. Does it make a difference if it is a pharmaceutical company selling a life-saving medicine that it has a patent on? What may be some longer term implications for the company, depending on their decisions about raising prices now?
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