The year is 2007, and the price elasticity of driving on the Dulles Toll Road is 1.6. The owners of the Dulles Toll Road raise the cost of a one way trip to $8.50. The revenue from the toll increase is not as large as the owners forecasted. Should they have set a lower or higher toll?
Higher, because demand is elastic
Lower because demand is inelastic
Lower, because demand is elastic
Higher, because demand is inelastic
This job determines elasticity.