Demand curve for cruises is straight line

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Reference no: EM131164530

When the price of a cruise rises from $19,500 to 20,500, the quantity demanded decreases from $2,100 to 1,900 travelers.

1. Use this information to calculate the chan in the total revenue of cruise providers is? ( how many?)

2. Base on that, the concepte of price elasticity of demand is useful beacuse if cruise providers know the price elasticity of demand for cruises, they can predict how total revenue will change when the price of a cruise changes. Is that Ture?

3. If the demand curve for cruises is a straight line, the price at which the demand is unit elastic is above or below $20000 a cruise?

Reference no: EM131164530

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