Car simulation when you raise prices into elastic range

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Reference no: EM133637337

Question

We know revenues decrease when you raise price into the range where prices are elastic (i.e., absolute value of elasticity>1.0), yet profits can increase as you raise price into the elastic range. Explain how it is possible for profits to increase in the rental car simulation when you raise prices into the elastic range. Choose the best answer.

Reference no: EM133637337

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