1. Your best friend is currently pursuing an online Economics course. She has sought your advice on the following scenarios. Please provide your friend with a detailed explanation on when and why the following scenarios may occur. a) The owner of Cool Waters Company Ltd, a water distilling and bottling company, wanted to increase the company’s sales revenue. After implementing the advice of the accountant to decrease the price of water, the sales revenue decreased. Please provide a detailed explanation on how elasticity of demand can explain why sales revenue may have decreased when prices decreased. Please ensure you define price elasticity of demand and explain how price elasticity of demand influences revenue b) Why will a company choose to sell the level of output at which Marginal Revenue is equal to zero? c) Why will the sum of the indices/exponents for a company’s Cobb-Douglas production function be less than 1. Please ensure you explain what the sum of the indices in the Cobb-Douglas function tell us.   d) After conducting research on a particular company your friend has discovered that the firm’s average total cost (ATC) is equal to the average variable cost (AVC) (i.e. ATC = AVC). Your friend seeks clarity from you by asking the following questions i. When does average variable cost EQUAL average total cost (i.e. AVC = ATC)? ii. When does average total cost NOT EQAUL TO average variable cost (i.e. ATC  AVC)?