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Single Variable Calculus

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Moderate

Price Elasticity from a Demand Equation

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The number of commuters taking a monorail is currently $2000$ per day, and the price is $\$5.00$ per ticket. The demand equation is

$$q = 500(6-\sqrt{p-1})$$

where $q$ is the number of commuters daily and $p$ is the price.

1) Is the price currently elastic or inelastic?
2) Should the price be increased or decreased in order to increase revenue?

A

inelastic; decreased

B

elastic; decreased

C

inelastic; increased

D

inelastic; decreased