Should it charge the users higher or lower prices

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Reference no: EM13816149

a) The museums operated by the US Art Services department have suffered from substantial losses for past years. The price elasticity of demand for the museums is estimated to be 0.6. If the US Art Services department would like to increase its total revenue, should it charge the users higher or lower prices? Explain?

b) John bus a T-shirt for $100 and the consumer surplus is $60. What is John’s maximum willingness to pay for the T-Shirt? Briefly explain.

Reference no: EM13816149

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