If a Krispy Kreme Doughnut Shop near Campus Increases Its

question 133

Multiple Choice

If a Krispy Kreme doughnut shop near campus increases its prices by 5 percent, but revenues from its sales are unchanged, the price elasticity of demand for the services offered by the doughnut shop must be

• A) elastic.
• B) of unitary elasticity.
• C) inelastic.
• D) equal to 0.5.

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Definitions:

Demand

The quantity of a good or service that consumers are willing and able to purchase at various prices during a specified time period.

Northwest-Corner Method

A technique used in solving transportation problems in operations research, starting with the top-left (northwest) corner of a matrix to minimize costs.

Source A

An initial or primary provider of information, materials, or resources, often referenced in research or procurement.

Capacity

is the maximum output that a system can produce over a given period under normal conditions.