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1.3 Price determination in a competitive market

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Question 16

A specialty tea merchant has estimated the price elasticity of demand for their signature matcha blend to be -1.5. If the merchant decides to increase the price of the matcha blend by 20%, then the total revenue generated from this blend will

A

rise by more than 12%12\%12%.

B

rise by less than 12%12\%12%.

C

fall by more than 12%12\%12%.

D

fall by less than 12%12\%12%.

Markscheme

1.3 Price determination in a competitive market Questions

  1. A Level
  2. /Economics
  3. /1.3 Price determination in a competitive market

256 exam-style questions on AQA A Level Economics 1.3 Price determination in a competitive market, covering 1.3.1 The determinants of the demand for goods and services, 1.3.2 Price, income and cross elasticities of demand, 1.3.3 The determinants of the supply of goods and services, 1.3.4 Price elasticity of supply, 1.3.5 The determination of equilibrium market prices, and 1.3.6 The interrelationship between markets. Each one has a worked solution and a mark scheme showing where the marks go.

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