Assume that you own a small boutique hotel. In an attempt to raise revenue, you reduce your rates by 20 percent. However, your revenue falls. What does this indicate about the demand for your boutique hotel rooms?
A) Demand is inelastic.
B) Boutique hotel rooms are inferior goods.
C) The demand curve for your hotel rooms is vertical.
D) Demand is elastic.
A
You might also like to view...
Holding the total output constant, the rate at which one input X may be substituted for another input Y in a production process is:
a. the slope of the isoquant curve b. the marginal rate of technical substitution (MRTS) c. equal to MPx/MPy d. all of the above e. none of the above
Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the short run would be:
A. P3 and Y1. B. P2 and Y1. C. P2 and Y3. D. P1 and Y2.
When deciding what to use as money, one characteristic to look for is its:
A. convenience. B. exchange value. C. intrinsic value. D. shape.
A local charity has decided to solicit donations door-to-door. The table below shows estimated donations for each hour a volunteer spends in the city, in the suburbs, and on campus. 
Given the above information, how should a volunteer allocate 10 hours in order to maximize the amount of total donations?
A. 4 hours in the city, 3 hours in the suburbs, 3 hours on campus B. 5 hours in the city, 4 hours in the suburbs, 1 hours on campus C. 6 hours in the city, 4 hours in the suburbs, 0 hours on campus D. 3 hours in the city, 4 hours in the suburbs, 3 hours on campus