You are in charge of the local city-owned golf course.You need to increase the revenue generated by the golf course in order to meet expenses.The mayor advises you to increase the price of a round of golf.The city manager recommends reducing the price of a round of golf.You realize that
A) the mayor thinks demand is elastic,and the city manager thinks demand is inelastic.
B) both the mayor and the city manager think that demand is elastic.
C) both the mayor and the city manager think that demand is inelastic.
D) the mayor thinks demand is inelastic,and the city manager thinks demand is elastic.

Question

Quizplus · Accepted Answer

The mayor's recommendation to increase the price of a round of golf suggests that they believe demand is inelastic, meaning that golfers will continue to play regardless of the price increase. In contrast, the city manager's recommendation to reduce the price of a round of golf suggests they believe demand is elastic, meaning that golfers are sensitive to changes in price and may be more likely to play if the cost is lower. Therefore, the best choice is D.

You Are in Charge of the Local City-Owned Golf Course