If Carnival Cruise Lines increased the price of its seven-day cruise package by 10 percent and, as a result, experienced a 20 percent decline in customer bookings, Carnival's demand would be
A)steady.
B)inelastic.
C)elastic.
D)prestige.
E)marginal.

Question

Quizplus · Accepted Answer

A 10% increase in price resulted in a 20% decline in customer bookings, indicating a relatively large change in quantity demanded in response to a small change in price. This suggests that demand is elastic, meaning consumers are sensitive to changes in price.

If Carnival Cruise Lines Increased the Price of Its Seven-Day