Author Question: It is Valentine's Day and Jason is desperately looking all over town for a dozen roses to give to ... (Read 56 times)

ENagel · **on:** Jun 30, 2018

It is Valentine's Day and Jason is desperately looking all over town for a dozen roses to give to Judy. Most likely, Jason's price elasticity of demand is:
a. infinitely large.
b. negative.
c. equal to one.
d. greater than one.
e. less than one.

Question 2

A public transit company finds that when it reduces the price of a bus ticket, total revenues remain the same. One can conclude from this that:
a. the demand curve is horizontal, reflecting infinite price elasticity.
b. the company sells the same number of bus tickets both before and after the price change.
c. the demand curve for bus tickets must have shifted to the right.
d. the firm is operating in a range of the demand curve that is unit elastic.
e. the price should be lowered further so that a larger quantity can be sold.