You are on a campus committee which sets the ticket prices for basketball games. The committee wants to increase the total money generated from ticket sales. When should the committee choose to lower its ticket prices?
A) Always.
B) Never.
C) When demand for basketball tickets is elastic.
D) When demand for basketball tickets is inelastic.

Question

Quizplus · Accepted Answer

If demand for basketball tickets is elastic, lowering ticket prices will result in an increase in the quantity of tickets sold, and thus an increase in total revenue. Therefore, the committee should choose to lower its ticket prices when demand for basketball tickets is elastic.

You Are on a Campus Committee Which Sets the Ticket