If a 10 % drop in the price of tickets to Sheffield Shield cricket matches leads to a 8% increase in attendance, the demand for the ticket is?

a. inelastic

b. elastic

c. unit elastic

d. perfectly elastic

Answer: Option A

Explanation:

Here there is a price drop of 10% in the tickets while there is 8% increase in attendance which means there is inelastic situation. It denotes that the quantity demanded of the product is less than the price change.

When the demand increases in equal quantity to price then it is unit elastic. Perfectly elastic means when there is just 1% decrease in price of tickets then the demand quantity is infinity. Elastic means there is huge percentage change in quantity demanded than the price change.