Shari and Mary have a business that provides personal fitness training services. They know that after raising their prices from $40 to $60 per hour, the quantity of hours they spent delivering training services fell from 90 to 50 hours per week. The demand for their services is:

Question

Quizplus · Accepted Answer

The decrease in quantity demanded (from 90 to 50 hours per week) was proportionally greater than the increase in price (from $40 to $60 per hour), indicating that the demand for their services is elastic. Therefore, the price elasticity coefficient (which measures the responsiveness of quantity demanded to changes in price) is greater than one.

Shari and Mary Have a Business That Provides Personal Fitness