If hospitals decide to increase the price of emergency appendectomies (surgery operation to remove inflamed appendix) in order to increase their revenues,
Question 3 options:
Then the reason that it will NOT be successful is because the demand curve is downward sloping.
It will be successful since the demand curve is elastic.
It will be successful since the demand is inelastic.
It will be successful since the supply is inelastic.
The correct answer is: It will be successful since the demand is inelastic.
If the demand for emergency appendectomies is inelastic, it means that the quantity demanded is not very responsive to changes in price. In this case, increasing the price of the surgery would lead to an increase in revenue for hospitals, as the demand for this life-saving procedure is relatively inelastic.