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riority mail has been one of the most profitable products for the U.S Postal service, between 1995 -1999 and accounting for almost 8% of the Postal Service's mail revenue. Because the Postal Service lost $480 million in the fiscal year ending September 30, 2000, it adopted the strategy of raising Priority Mail rates by 16 percent to help to offset the loss. Bear Creek Corporation planned to ship 15 to 20 percent fewer Priority Mail packages in response to the rate increase. If this corporation's response is typical for Priority Mail customers, will the Postal Service meet its goal of reducing its deficit with this Policy?

Microeconomics, Economics

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