The Figure Above Shows the Demand Curve for Starbucks Latte

question 184

Multiple Choice

The figure above shows the demand curve for Starbucks latte.
-Using the figure above,suppose Starbucks charges $4.50 per cup for its latte.Which of the following is true?
i.At this price,the demand for Starbucks latte is elastic.
ii.If Starbucks lowers the price of its latte,its revenue will decrease.
iii.If Starbucks raises the price of its latte,the demand for it will become less elastic.

• A) Only iii
• B) Only i
• C) Only ii
• D) i and ii
• E) i and iii

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