Watch the video clip from Bart Gets an Elephant. (View Transcript.)
Consider the relationship between price elasticity of demand and total revenue, and why Homer didn’t make the smartest business decision when raising the price of admission. For this week’s discussion question, you should pick two products: one that is relatively price inelastic and another that is relatively price elastic. You can determine a product’s relative price elasticity by considering the Determinants of the Price Elasticity of Demand listed in your textbook. You should begin by defining your product in terms of the determinants and then describe how increases in the price would affect total revenue.
Would it make good business sense to be the one producing and selling these products? Why or why not?
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Post your initial response to the discussion question no later than Thursday 11:59 PM EST/EDT. You will not be able to see any of your classmates’ posts until you have posted your initial response.
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Respond to at least two of your classmates no later than Sunday 11:59 PM EST/EDT.
Citation: Swartzwelder, J. (Writer), & Reardon, J. (Director). (1994). Bart gets an Elephant [Television series episode]. In M. Groening (Producer), The Simpsons. Los Angeles, CA: 20th Century Fox.
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