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29 December, 03:46

Label the scenarios as examples of elastic, inelastic, or unit elastic demand. When Ruko, a device used to stream movies at home, increases prices by 39 %, total revenue decreases by 67 %. When Cinema Supreme decreases ticket prices by 19 %, total revenue does not change. When Bluebox, a DVD rental kiosk, increases its prices by 44 %, total revenue increases by 31 %.

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  1. 29 December, 05:10
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    case 1 elastic demand

    case 2 unit elastic demand

    case 3 inelastic demand

    Explanation:

    case 1

    increases prices = 39 %

    total revenue decreases = 67 %

    so it is example of elastic demand

    because here price increase and that cause decrease in quantity demand

    so here we know revenue will be come down

    and

    case 2

    decreases ticket prices = 19 %

    total revenue = not change

    so it is example of unit elastic demand

    because here price change and quantity demand similar

    so here we know revenue does not change

    and

    case 3

    increases its prices = 44 %

    total revenue increases = 31 %

    so it is example of inelastic demand

    because here price change is greater than quantity demand

    so it cause the increase in total revenue
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