Interior Department Recently Announced That It Will Increase the Entrance

question 36

Multiple Choice

Interior Department recently announced that it will increase the entrance fees at Yellowstone National Park in order to increase park revenues.The Interior Department must believe that

• A)park goers are very responsive to price changes.
• B)the demand for park services is elastic.
• C)the percentage increase in fees will be greater than the percentage decrease in the number of park visitors.
• D)demand is unitary elastic,and thus the number of visitors will NOT decrease.

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Definitions:

Price Decreases

Reductions in the cost of goods or services, often leading to increased demand.

Normal Goods

Goods for which demand increases as the income of individuals increases, indicating a positive relationship between income and demand.

Equilibrium Price

This is the price at which the quantity of goods supplied matches the quantity of goods demanded, resulting in market equilibrium.

Demand Curve

A graph depicting the relationship between the price of a good and the quantity demanded by consumers at those prices.