Answer to Question #216585 in Economics for Paballo

Question

• The admissions policy of Makopani University of Technology is to admit any student who is willing to pay the university's tuition fees. To increase its total revenue, the board of the university decides to reduce tuition fees. They A. believe that the demand for education from the Makopani University of Technology is perfectly inelastic.
•  B. believe that the demand for education from the Makopani University of Technology is elastic.
•  C. are ignoring the law of demand.
•  D. believe that the demand for education from the Makopani University of Technology is inelastic.

Answer 1

If to increase its total revenue, the board of the university decides to reduce tuition fees, then they believe that the demand for education from the Makopani University of Technology is elastic.

So, the correct answer is B.