Elasticity and Vanity Plates. Suppose the price elasticity of demand for vanity plates in your state is 0.60. The initial price is $20 and the initial quantity is 1,000 plates per week. Suppose the...

Elasticity and Vanity Plates. Suppose the price elasticity of demand for vanity plates in your state is 0.60. The initial price is $20 and the initial quantity is 1,000 plates per week. Suppose the state increases the price by 10 percent. (Related to Application 2 on page 443.)

a.Predict the new quantity per week and total revenue per week.

b. The increase in price _________ (increases, decreases) total revenue because _________ is _________.