O 1. Elasticity: What is elasticity? b. What is Price Elasticity of Demand? C. What is the formula that we will use to calculate it? d. After calculating the Coefficient of Price Elasticity of Demand, what are the rules we use to characterize that price range? (i.e. What importance does the number one play?) e. What is the total revenue test? 2. Yesterday, the price of fishing line was $3 a spool, and Taylor was willing to buy 10 spools. Today, the price has gone up to $3.75 a spool, and Taylor is now willing to buy 8 spools. Is Taylor's demand for fishing line elastic or inelastic? 3. Suppose you work for a local car parts supplier, and you're looking at ways to increase revenue. You remember from your economics course, that people respond to price changes. You decide to test this theory. Assume, that as the price of an alternator falls from $40.00 to $38.00 the quantity of Y demanded increases from 110 to 118. a. Then the coefficient of price elasticity of demand is: b. If you want to increase revenue, you should