PRC-3 · Chapter 11 · Question 30 of 57
If a cinema increases its ticket prices by 15%, and discovers that its total overall revenue remains exactly the same as before, the demand for tickets is:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Unitary elastic
Explanation
According to the total outlay/expenditure method, if a change in price results in absolutely no change in total expenditure, the demand is unitary elastic (PED = 1).
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