If Stimpson University increases tuition in order to increase its revenue, it will: a. be successful if demand is elastic. b. not be successful if the demand curve slopes downward. c. be successful if demand is inelastic. d. be successful if supply is lastic.

The correct answer is: **c. be successful if demand is inelastic.** ### Explanation: When a university like Stimpson University considers increasing tuition to boost revenue, it's essential to understand how **price elasticity of demand** affects this decision. - **Price Elasticity of Demand** measures how sensitive the quantity demanded is to a change in price. - **Elastic Demand (Elasticity > 1):** Consumers are highly responsive to price changes. If demand is elastic, increasing tuition would lead to a significant drop in the number of students, potentially reducing overall revenue. - **Inelastic Demand (Elasticity < 1):** Consumers are less responsive to price changes. If demand is inelastic, increasing tuition would lead to a smaller drop in the number of students, thereby increasing overall revenue. Given this: - **Option a** is incorrect because if demand is elastic, increasing tuition would likely **decrease** revenue. - **Option b** is misleading. A downward-sloping demand curve is a standard assumption in economics and doesn't directly determine revenue outcomes without considering elasticity. - **Option d** focuses on the elasticity of supply, which is not directly relevant to the revenue effects of a price increase in this context. Therefore, **Option c** accurately reflects the condition under which increasing tuition would successfully increase revenue. **Answer:** c. be successful if demand is inelastic.