Assume Pyrotex Inc

question 14

Multiple Choice

Assume Pyrotex Inc. estimates the demand for its fireworks to be linear. If the current price charged by Pyrotex is such that the elasticity of demand is equal to 2.5, which of the following statements is true?

• A) Pyrotex will surely increase its profits by decreasing the price of fireworks.
• B) Pyrotex will surely increase its profits by increasing the price of fireworks.
• C) Pyrotex cannot increase its profits by changing the price of fireworks.
• D) Not enough information is provided to determine whether Pyrotex is currently maximizing its profits.

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Definitions:

Choroid

A vascular layer of the eye between the retina and the sclera, providing oxygen and nourishment to the outer layers of the retina.

Lens

A transparent structure in the eye that focuses light onto the retina to produce clear images.

Vitreous Humor

A transparent, gel-like substance filling the space between the lens and the retina of the eye, helping it maintain shape and optical properties.

Cornea

The clear, dome-shaped surface that covers the front of the eye and contributes to the eye's focusing power.