Elixir Spring produces a unique and highly prized mineral water. The firm's total fixed cost is $5,000 a day, and its marginal cost is zero. Table 1 shows the demand schedule for Elixir water.
Compare Elixir's profit-maximizing price with the marginal cost of producing the profit-maximizing output. At the profit-maximizing price, is the demand for Elixir water inelastic or elastic?
