Use the following to answer question:
-(Figure: The Linear Demand Curve)Use Figure: The Linear Demand Curve.Suppose this is the demand curves for scarves in your scarf shop.If you increase the price of your scarves from $7 to $8,your total revenue will _____,and you notice that your price elasticity of demand is _____.
A)increase;elastic
B)decrease;elastic
C)increase;inelastic
D)decrease;inelastic

Question

Use the following to answer question: 
-(Figure: The Linear Demand Curve)Use Figure: The Linear Demand Curve.Suppose this is the demand curves for scarves in your scarf shop.If you increase the price of your scarves from $7 to $8,your total revenue will _____,and you notice that your price elasticity of demand is _____.
A)increase;elastic 
B)decrease;elastic 
C)increase;inelastic 
D)decrease;inelastic

Quizplus · Accepted Answer

When you increase the price and total revenue increases, it indicates that the demand is inelastic. This means that the percentage change in quantity demanded is less than the percentage change in price, leading to an increase in total revenue.

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