KFC Raises the Price of Its Chicken Nuggets

question 99

Multiple Choice

KFC raises the price of its chicken nuggets. The price elasticity of demand for KFC chicken nuggets is 0.8. What happens to KFC's total revenue?

• A) It decreases.
• B) Nothing.
• C) It increases.
• D) It becomes negative.
• E) It might change, but more information is needed to determine if it increases, decreases or does not change.

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Definitions:

Business

An organization or enterprising entity engaged in commercial, industrial, or professional activities with the aim of generating profits.

Umbrella Liability

A package of several kinds of insurance.

Liability Insurance

A type of insurance that provides protection against claims resulting from injuries and damage to people or property.

Economical Premium

A cost-effective payment or fee, usually for insurance, that provides value or savings over time.