While there are many pizza places in Curtisville, Pappy's Pizza is known for its distinctive deep-dish pizza with an almost pie-like crust, whereas Momma's Pizza Pizzazz is comparable to many other restaurants. Pappy's is likely to find that it can prices to increase total revenue, and Momma's must prices to increase total revenue.
A) raise; lower
B) lower; raise
C) raise; raise
D) lower; lower
E) raise; not change

Question

Quizplus · Accepted Answer

Pappy's Pizza, with its distinctive product, likely has inelastic demand, allowing it to raise prices to increase revenue. Momma's Pizza Pizzazz, being more comparable to others, likely faces elastic demand, so it must lower prices to increase revenue.

While There Are Many Pizza Places in Curtisville, Pappy's Pizza