"Um, and then we've projected for this first caland - bear of ours in business about $240.000. Robert: What does it Cus . . ou to make it? 0:00 / 8:46 are really good. 38% when we sell direct online and then / 1%. Watch the Purse Elasticity of Demand episode of Shark Tank - Season 5, Episode 10: Jenn Deese and Kelley Coughlan pitch Purse case, a smartphone case that doubles as a small purse. Kevin O'leary is flabbergasted by its high price and immediately argues they could change cut the price by 50% and sell ten times more than they are currently selling. In his mind, Purse Case is a product with very elastic demand - so elastic that he thinks they could lower the price and collect much more in revenue. Question 1 A: Based on the sales numbers given in the video, calculate the elasticity of demand for this product perceived by Mr. O'leary. Show step wise calculations starting with the formula. (10 Points) Question 1 B: Kevin suggests lowering the price to $19.95 will result in ten times more sales. If Kevin is right, is demand elastic or inelastic? Support your answer by calculating total revenue. (10 points) Question 2 : Suppose that a 20% increase in the price of gasoline causes a 5% decrease in the consumption of gasoline and a 30% drop in the sales of SUVs. What can you say about elasticities? Describe the nature of the relation between two products (5 Points)