On November 1, 1981 the U.S. Post Office
raised the price of mailing a first class letter from 18
to 20 cents, an increase of about 11.1%. If the Post
Office faced a section of its demand curve that was
elastic, one can predict that revenues would:
increase by more than 11.1%.
increase by 11.1%.
increase, but by less than 11.1%
Price elasticity of supply will be
larger the price elasticity of
smaller the price elasticity of
shorter the time that sellers have to
adjust to the change in price.
longer the time that sellers have to adjust to the
change in price.