Ok so I was arguing with my teacher about this one question: Based on the price elasticity of demand coefficient determine whether the price should be increased or decreased for revenue to increase. PED coefficient: -1.2, 0.8, 2.4, -0.3. He said that for -1.2 they should decrease price and for -0.3 increase. I agreed with him but then he said that 2.4 should be decreased price to increase revenue because it is elastic. However I said that its 2.4 and not -2.4 so even if its elastic as from PED formula price and quantity demanded would have to both increase or decrease to get it as a positive number therefore we can't really determine whether revenue would increase/decrease. I think he made the question himself so maybe he made a mistake of putting positive coefficient. I have researched that some products have positive like caviar (dunno if true). So my question who was right?


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