Harold is the new manager of Jan's Pizza Parlor. He has been told that the price elasticity of demand for his product is 1.10. Which of the following statements are correct?

a. The demand for his pizza is elastic.

b. If Harold raises the price of pizza, the total revenue for the operation will increase A decrease in the pizza price will increase the total revenue of the business.

c ... A $1.00 increase in quantity will cause an increase in sales of 110 pizzas.

d. A 10% increase in price of pizzas will cause an 11% decrease in quantity of pizzas demanded.

The correct statements are: A, B and D

a. The demand for his pizza is elastic.

b. If Harold raises the price of pizza, the total revenue for the operation will increase A decrease in the pizza price will increase the total revenue of the business.

d. A 10% increase in price of pizzas will cause an 11% decrease in quantity of pizzas demanded.

Explanation:

Price elasticity of demand is a financial measure of the reform in the amount of a product that is requested or bought in relation to its change in prices.

Mathematically, price demand elasticity = % change in the quantity demanded / % price change

Where there is a substantial change in the amount requested of a goods because of the price changes, it is called "elastic" which means the quantity is far from its predecessor. If the volume paid in addition to the demand has adjusted Small, it is regarded as "inelastic" or the quantity did not go much further.