Suppose That Chris Had Been Charging $1

question 98

Multiple Choice

Suppose that Chris had been charging $1.00 per pound for potatoes.When Chris lowered the price to $0.90 per pound,total revenue fell.When Chris raised the price to $1.10,total revenue also fell.Why?

• A)$1.00 is the equilibrium price for potatoes.
• B)At 90 cents,there is excess demand for potatoes.
• C)$1.10 is more than Chris's customers' reservation prices.
• D)Price elasticity of demand is unitary at $1.00.

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