Assume that the price of hand sanitizer increased b nd the total revenue of hand sanitizer firms increas 20%. From this we know that a. Price elasticity of demand is elastic. b. Price elasticity of demand us unit elastic.
Please explain the answer: thank you
The issue is best described as follows:
Analyzing the link between changes in hand sanitizer prices and the ensuing changes in total income for hand sanitizer companies is the challenge. The issue specifically aims to identify the price elasticity of hand sanitizer demand.
In this instance, the available data shows that both the price and overall income increased by 20%. Based on this data, the objective is to deduce the price elasticity of demand. The aim is to decide which of the choices (a, b, c, and d) represents the price elasticity of demand in the most correct way.
Simply put, the issue is how customers respond to a price rise for hand sanitizer and what it says about the nature of demand for this good.
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