Suppose you are on a committee seeking to increase revenue from your city's bus system. If demand is _______, you would recommend raising the fare.
A) perfectly elastic
B) elastic
C) unitary elastic
D) inelastic

Question

​Suppose you are on a committee seeking to increase revenue from your city's bus system. If demand is _______, you would recommend raising the fare.
A) ​perfectly elastic
B) ​elastic
C) ​unitary elastic
D) ​inelastic

Quizplus · Accepted Answer

If demand is inelastic, it means that a change in the price of the bus fare would not significantly impact the quantity demanded. Therefore, raising the fare would result in a higher revenue for the bus system.

​Suppose You Are on a Committee Seeking to Increase Revenue

Suppose You Are on a Committee Seeking to Increase Revenue