College students and faculty members have a more elastic demand than the general public for Apple's iMac desktop computers.From this we can conclude that
A)Apple will charge college students and faculty members higher prices than it charges the general public.
B)Apple will charge college students and faculty members lower prices than it charges the general public.
C)the general public will earn arbitrage profits by buying iMac desktop computers from Apple and reselling them to college students and faculty members.
D)Apple will earn economic profits from the computers it sells to the general public but will break even on the computers it sells to college students and faculty members.

Question

Quizplus · Accepted Answer

Since college students and faculty members have a more elastic demand for iMac desktop computers, Apple will have to lower its prices to attract them. This is because if Apple charges higher prices to this group, they are more likely to switch to other brands or alternatives. Thus, Apple will offer lower prices to college students and faculty members than the general public.

College Students and Faculty Members Have a More Elastic Demand