1312EconomicsMedium
Suppose that at a price of Rs 30 per month there are 30000 subscribers to cable television in small Town. If small Town Cablevision raise its price to Rs 40 per month the number of subscribers will fall to 20000 At which of the following price does small Town Cablevision earn the greatest total revenue?
ARs 0 per month
BRs 30 per month
CEither Rs 30 or Rs 40 per month because the price elasticity of demand is 1.0
DRs 40 per month
Correct answer
B. Rs 30 per month
Explanation
The correct answer is Rs 30 per month.