There are many businesses selling flowers in Brisbane on any given day. A flower shop sells a basic bouquet for $24.99 and sells, on average, 10 bouquets per day. The flower shop decides to decrease the price of the basic bouquet to $20.99 and sells 18 bouquets that day.

Which of the following statements are true (to four decimal places):

The point price elasticity of demand for the basic bouquet of flowers at a price of $24.99 is 4.9980.

There are many businesses selling flowers in Brisbane on any given day. A flower shop sells a basic bouquet for $24.99 and sells, on average, 10 bouquets per day. The flower shop decides to decrease the price of the basic bouquet to $20.99 and sells 18 bouquets that day.

Which of the following statements are true (to four decimal places):

A 1% increase in the price of a basic bouquet would lead to a 1.2495% decrease in the quantity of basic bouquets demanded.

B. 1% decrease in the price of a basic bouquet would lead to a 1.2495% increase in the quantity of basic bouquets demanded.

Public transport is an important service for students travelling to the University of Queensland. Many students do not have access to a car.So if the price of public transport increases by 1%, the number of students using public transport will reduce by less than 1%.

From the above we can infer that:

1. Demand for public transport by students at the current price is inelastic.
2. If prices fell by 1%, the increase in quantity demand for public transport by students would be greater than 1%.
3. Demand for public transport by students at the current price is elastic.

Which of the following statements are true:

Only 1 is true.

Only 2 is true.

Both 1 and 2 are true.

Both 2 and 3 are true.

All three are true.