Economics 9708 · AS & A Level · Price elasticity of demand

Price elasticity of demand — practice question

A local government is considering raising parking charges and adding more lanes reserved for buses only. One official stated that higher parking charges ought to lead to more bus travel. Another official stated that increasing how often buses run will not make demand for bus travel increase. Are these officials’ statements correct or incorrect?

  • Afirst statement correct; second statement correct
  • Bfirst statement correct; second statement incorrect
  • Cfirst statement incorrect; second statement correct
  • Dfirst statement incorrect; second statement incorrect

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