A) The price elasticity of demand is given by
... Ed = (dx/dp)·(p/x)
... = -250·(15/(9500-250·15)) ≈ -0.652
B) This value has a magnitude less than 1, so price can be increased to increase revenue.
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The price at which Ed has a magnitude of 1 is ...
... 250p/(9500 -250p) = 1
... 250p = 9500 -250p
... 500p = 9500
... p = 9500/500 = 19
Revenue will increase as price increases up to $19 per pair.
