Question

Suppose the Carolina Panthers football team lowers ticket prices by 20 percent and, as a result, the quantity of tickets demanded increases by 25 percent.

This response means that the demand for tickets is:

A. perfectly elastic.
B. elastic.
C. inelastic.
D. unit elastic.

Answer 1

The correct answer is B. elastic.

Step-by-step explanation:

Elastic demand occurs when, when any price changes for a good, the quantity demanded is drastically affected. In this case, there is a considerable variation in the price of the tickets, since there is no substitute good that people can access. This behavior is contrary to inelastic demand, since there is little or no variation in it.