The souvenir sheets are designed and printed for the postal service by a stamp agency service company

The answers to both the given sub-questions are explained below:

1. Price elasticity of demand for the souvenir sheets

Here, the percentage change in the selling price per unit of souvenir sheet
= (New selling price per unit - old selling price per unit) / old selling price per unit
= ($11 - $10) / $10
= +10% (increase)

Also, percentage change in quantity demanded
= (New sales in units - old sales in units) / old sales in units
= ($51,000 - $61,000) / $61,000
= -16.39% (decrease)

Now, price elasticity of demand
= percentage change in quantity demanded / percentage change in the selling price per unit
= -16.39% / +10%
= -1.64

2. Profit-maximizing price for the souvenir sheets

= Marginal cost per unit x price elasticity of demand / (price elasticity of demand +1)
= $1.15 x -1.64 / (-1.64 + 1)
= $2.95