I’m trying to study for my Economics course and I need some help to understand this question.
How does advertising benefit society? In what ways can advertising be harmful? Give an example (YouTube link) of an effective advertisement (that had a positive impact on demand).
2. Monopolies and Elasticity
Recalling what you have learned about elasticity, what can you say about the connection between the price a monopolist chooses to charge and whether or not demand is elastic, unitary, or inelastic at that price? (Hint: Examine the marginal revenue curve of a monopolist. The fact that marginal revenue becomes negative at low prices implies that a portion of the demand curve cannot possibly be chosen.) Please include an example with your posting.
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