You are curator of a major art museum. Your director of finance tells you that the museum is running short of funds and suggests that you consider changing the price of admission to increase total revenue.

If the demand for visits to the museum is inelastic, then an increase in the price of admission would increase total revenue. But if the demand is elastic, then an increase in price would cause the number of visitors to fall by so much that total revenue would decrease. In this case, one should cut the price. The number of visitors would rise by so much that total revenue would increase.

What do you do? Do you raise the price of admission, or do you lower it? How will you explain the concept of elasticity and your proposed action plan to the director?