Question
The table below provides the demand schedule for rides on Uber, a popular ride-sharing service that works in competition with the taxi industry. Use the
The table below provides the demand schedule for rides on Uber, a popular ride-sharing service that works in competition with the taxi industry. Use the information provided to complete the table, filling in the blanks where indicated. show your work for each column.
Rate | Quantity Demanded( Number of rides, Thousands) | Total Revenue (Thousands of Dollars) | % Change in Price | % Change in Quantity Demanded | Elasticity |
$1/Mile | 25 | ___ | ___ | ___ | ___ |
$2/Mile | 20 | ___ | ___ | ___ | ___ |
$3/Mile | 15 | ___ | ___ | ___ | ___ |
$4/Mile | 10 | ___ | ___ | ___ | ___ |
$5/Mile | 6 | ___ | ___ | ___ | ___ |
$6/Mile | 3 | ___ | ___ | ___ | ___ |
A) Suppose Uber is currently charging $1.50/mile. To increase total revenue, should Uber raise or lower rates? Explain in a sentence.
B) Suppose Uber is currently charging $5.50/mile. To increase total revenue, should Uber raise or lower rates? Explain in a sentence.
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