Question
If Sam the Pizzaiolo lowers the price of their pizzas from $6 to $5 and finds that sales increase from 400 to 600 pizzas per week, then the demand for Sam's pizzas in this range is:
A. unit elastic
B. inelastic
C. elastic
D. inferior
A. unit elastic
B. inelastic
C. elastic
D. inferior
Answers
GPT 3.5
C. elastic
This is because the percentage change in quantity demanded (50%) is greater than the percentage change in price (16.67%), indicating that the demand for Sam's pizzas is elastic in this price range.
This is because the percentage change in quantity demanded (50%) is greater than the percentage change in price (16.67%), indicating that the demand for Sam's pizzas is elastic in this price range.