Question

The movie theater in your neighborhood charges lower ticket prices to senior citizens than to other patrons. Assuming that this pricing strategy increases the profits of the movie theater, we can conclude that senior citizens must have ________ for movie tickets than other patrons. greater demand lower demand more elastic demand less elastic demand

Answer 1

More elastic

Step-by-step explanation:

Demand is elastic if a small change in price has a greater effect on the quantity demanded.

Demand is inelastic if a small change in price has little or no effect on quantity demanded.

The senior citizens have an elastic demand because when price was reduced, the profits earned by the theatre increased. This means the Quanitity demanded of movie tickets increased.

If demand were inelastic and prices were reduced, profits would fall.

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