Question

You are the curator of a museum. The museum is running short of funds, so you decide to increase revenue. What should you do to increase revenue if the price elasticity of demand is 0.45? Lower the admission price Nothing, revenue is maximized at current admission price Raise the admission price

Answer 1

The answer is "Raise the admission price ".

Step-by-step explanation:

Users are indeed the museum's curator. The gallery is short of funds, so you decide to improve their revenue. Increase admittance price because demand in this situation is inelastic and higher pricing will lead to larger revenues which generate revenue when the online listing is 0.45.

It won't affect the level that is required. The revenue will increase due to the increase in the price as well as a price inelastic toll on the museum admission, therefore not adversely affected the market.