1. Suppose the demand for baby shoes in a small town is described by the equation: Q = 50 - 2P where Q is the quantity of baby shoes demanded and P is the average price of a pair of baby shoes.
   1. What is the price elasticity of demand for baby shoes when the price is $15? (Hint: use the point-formula). Is the demand at this price elastic or inelastic.

1. In order to increase revenue, should baby shoe sellers increase or decrease the price? Explain.

1. What is the price elasticity of demand for baby shoes when the price is $10? Is the demand at this price elastic or inelastic.