Recently a Railroad Asked the State Commerce Commission for Permission

Multiple Choice

Recently a railroad asked the state commerce commission for permission to increase its commuter rates by 20 percent.The railroad argued that declining revenues made this rate increase essential.Opponents of the rate increase contended that the railroad's revenues would fall because of the rate hike.It can be concluded that:

A) the railroad felt that the demand for passenger service was elastic and the opponents of the rate increase felt it was inelastic.
B) the railroad felt that the demand for passenger service was inelastic and the opponents of the rate increase felt it was elastic.
C) both groups felt that the demand was inelastic but for different reasons.
D) both groups felt that the demand was elastic but for different reasons.
E) both groups felt that the demand was inelastic for the same reason.