Refer to the figure above. Suppose Starbucks charges $3.50 per cup for its latte. Which of the following is true?

i. At this price, the demand for Starbucks latte is inelastic.
ii. If Starbucks raises the price of its latte, its revenue will increase.
iii. If Starbucks lowers the price of its latte, it will increase its revenue.
A) Only iii
B) Only i
C) Only ii
D) i and ii
E) i and iii

A

Economics

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