Asked by courtney mitchell on Jun 17, 2024
Verified
You are the newly appointed sales manager of the Rock Computer Tablets Company and have been charged with the task of increasing revenues. Your economics consultants have informed you that at present price and output levels, price elasticity of demand for your product is less than one. You should
A) decrease prices.
B) increase prices.
C) hold prices constant and increase supply.
D) cut advertising expenditures to save money.
Price Elasticity
A metric for assessing how much demand for a product fluctuates with its price.
Sales Manager
A sales manager is responsible for leading and guiding a team of salespeople in an organization.
Economics Consultants
professionals or firms that provide expert advice and analysis on economic trends, policies, and conditions to businesses, governments, or other organizations.
- Discern the impact of elasticity on both revenue accrual and the implementation of pricing schemes.
Verified Answer
SB
Shelbe ButnerJun 22, 2024
Final Answer :
B
Explanation :
Since the price elasticity of demand is less than one, the demand for the product is inelastic. This means that a price increase will lead to a smaller percentage decrease in quantity demanded, potentially increasing total revenue.
Learning Objectives
- Discern the impact of elasticity on both revenue accrual and the implementation of pricing schemes.