Table 6-5 -Refer to Table 6-5. Katie Graham Owns a Kayak Rental

question 227

Multiple Choice

Table 6-5

-Refer to Table 6-5. Katie Graham owns a kayak rental service in Santa Barbara. Table 6.3 below shows her estimated demand schedule for kayak rentals per week. She would like to increase her sales revenue by changing the price she charges for rentals. At present she charges $75. Based on the information in the table, Katie

• A) is not able to increase her revenue by changing her price because the demand for kayak rentals is unit-elastic.
• B) should lower her price to $60 to increase her revenue because the demand for kayak rentals is price elastic.
• C) should raise her price to $80 to increase her revenue because the demand for kayak rentals is price inelastic.
• D) should raise her price to earn the most revenue.

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Definitions:

Medical Necessity

A legal and medical determination that a service or treatment is reasonably necessary for the diagnosis or treatment of illness or injury.

Insurance Carriers

Companies that provide insurance policies, offering protection against financial losses stemming from various risks.

Insurance Coverage

A contractual agreement in which an insurer agrees to compensate or protect an insured party against specified losses or damages in exchange for a premium.

Medical Assistant

A healthcare professional who supports medical practices by performing various administrative and clinical tasks.