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Applications of price elasticity concept

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Assume that the demand for plastic surgery price is inelastic. Are the following statements true or false? Explain your answer

1.When the price of plastic surgery increases, the number of operations decreases.

2.The percentage change in the price of plastic surgery is less than the percentage change in quantity demanded.

3.Changes in the price of plastic surgery do not affect the number of operations.

4.Quantity demanded is quite responsive to changes in price.

5.The marginal revenue of another operation is negative.

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Solution Summary

Solution determines if the given statements are true or false based upon the information provided.

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1.When the price of plastic surgery increases, the number of operations decreases.
True, basic principal of demand says that price and quantity demanded have an inverse relationship.

2.The percentage change in the price of plastic surgery is less than the ...

Solution provided by:
Lokesh Jain, MSc
Education
  • BEng (Hons) , Birla Institute of Technology and Science, India
  • MSc (Hons) , Birla Institute of Technology and Science, India
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