The underground fare in your town has just been increased from a current level of $1.00 to $1.20 per ride. As a result, a 10 per cent decline in the number of passengers was noticed. a) Compute the price elasticity of demand for underground rides. Answer (enter a numerical value): b) Would you expect an increase or a decrease in revenues resulting from this price change? Answer (select): c) If the fare was reduced back to $1.00, what impact would you expect on the number of passengers? Answer (select):
The underground fare in your town has just been increased from a current level of $1.00 to $1.20 per ride. As a result, a 10 per cent decline in the number of passengers was noticed. a) Compute the price elasticity of demand for underground rides. Answer (enter a numerical value): b) Would you expect an increase or a decrease in revenues resulting from this price change? Answer (select): c) If the fare was reduced back to $1.00, what impact would you expect on the number of passengers? Answer (select):
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
The underground fare in your town has just been increased from a current level of $1.00 to $1.20 per ride. As a result, a 10 per cent decline in the number of passengers was noticed.
a) Compute the
Answer (enter a numerical value):
b) Would you expect an increase or a decrease in revenues resulting from this price change?
Answer (select):
c) If the fare was reduced back to $1.00, what impact would you expect on the number of passengers?
Answer (select):
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