3))Knitex wants to maximize its profits. It produces a product that has many substitutes and requires a large share of the consumer’s budget. In order to increase revenues, Knitex has decided to increase the price of the product. Which of the following statements is true about Knitex’s decisions ? a)The elasticity of demand for Knitex’s product is probably inelastic so increasing price will not change revenue b)The elasticity of demand for Knitex’s product is probably elastic so increasing price will decrease revenue c)The elasticity of demand for Knitex’s product is probably inelastic so increasing price will increase revenue d)The elasticity of demand for Knitex’s product is probably elastic so increasing price will not change revenue
3))Knitex wants to maximize its profits. It produces a product that has many substitutes and requires a large share of the consumer’s budget. In order to increase revenues, Knitex has decided to increase the
a)The
b)The elasticity of demand for Knitex’s product is probably elastic so increasing price will decrease revenue
c)The elasticity of demand for Knitex’s product is probably inelastic so increasing price will increase revenue
d)The elasticity of demand for Knitex’s product is probably elastic so increasing price will not change revenue
Step by step
Solved in 3 steps
