If funeral homes discover that the price elasticity of demand for caskets equals 0.55 at the current price,funeral homes could increase revenue by increasing the price.

Question

Quizplus · Accepted Answer

A price increase would lead to a revenue increase since the demand for caskets is inelastic (0.55<1), meaning the percentage change in quantity demanded will be less than the percentage change in price, resulting in a revenue increase.

If Funeral Homes Discover That the Price Elasticity of Demand