(Answered) If demand for a given product is highly elastic:If demand for a given product is highly elastic:

➤ How should firms set prices if demand is highly elastic?
Firms should use competitive pricing and consider modest price cuts to grow volume. Emphasize differentiation, loyalty programs, bundling, and cost efficiency to protect margins. Run price experiments and estimate elasticity before major moves, and focus marketing to reduce perceived substitutability and make demand less price-sensitive.