Question

During the 1992 Democratic National convention a group of 100 New York restaurants got together and offered lunch for $19.92, and a number of them added special dinner menus with meals priced at $24.92. These prices may seem high, but they were a substantial reduction for most of the participating restaurants. The result: revenues were up during the convention, but what happened after the delegates left? Many restaurants decided to keep their prices down and got a real surprise: lower prices brought in more total revenue. we may surmise that demand at New York restaurants is..
A.) has unitary price inelasticity.
B.) Price elastic.
C.) Price inelastic.
D.) equivalent to income elasticity of demand

Answer 1

Answer:

B. price elastic

Explanation:

we may surmise that demand at New York restaurants is PRICE ELASTIC