contestada

The local bakery makes such great cinnamon rolls that consumers do not respond much at all to a change in the price. If the owner is only interested in increasing revenue, she should
a. lower the price of the cinnamon rolls.
b. reduce costs.
c. raise the price of the cinnamon rolls.
d. leave the price of the cinnamon rolls unchanged.

Respuesta :

lucariel92

Answer:

c. raise the price of the cinnamon rolls.

Explanation:

1% increase in the price will have less 1% decrease in demand, when prices are inelastic supply can increase prices to increase revenue up until the point the marginal costs = marginal revenue

Parrain

Based on the fact that consumers do not respond much to a change in price, the local bakery owner should c. raise the price of the cinnamon rolls.

How should the local bakery increase revenue?

When research shows that consumers do not mind a change in price, it means that the good is inelastic in demand.

To raise revenue, the local bakery can increase prices because the consumers will still buy the rolls and more profit will be made per roll.

Find out more on inelastic demand at https://brainly.com/question/26850555.

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