Answer:
elastic
Step-by-step explanation:
It is given that the local movie theater gets a revenue amount of $40,000 in a month when the movie ticket price is $8 but it earns a revenue of only $35,000 when the price of the movie ticket increases to $10.
The revenue of the movie theater decreases from $40,000 to $35,000 when the price of movie tickets increases increases form $8 to $10 and so the demand is elastic.
When the demand is unit elastic, the revenue is maximum. It increases when the price increases and the demand is inelastic. Whereas it decreases when the price increases and if the demand is elastic.