Suppose Starbucks currently charges $2.50 per cup for its latte
If Starbucks raises the price to $3.00 per cup, based on the demand curve in the figure above, its total revenue will ________ because the demand for Starbucks latte is ________ over this price range.
A) increase; elastic
B) decrease; elastic
C) increase; inelastic
D) increase; unit elastic
E) not change; unit elastic
C
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A monopolistic competitor has fixed costs of $100 and marginal costs of $10 per unit. What is its marginal revenue at its equilibrium price and quantity?
a. $10 b. $11 c. $1,100 d. $2,000
The statement, "John buys more of good X as his income increases, Ceteris paribus," means:
a. John's income is being held constant. b. John's purchases of good X are being held constant. c. John's income and purchases of this good are being held constant. d. the price of this good is being allowed to change.