If demand is elastic,then
A)An increase in price will reduce total revenue.
B)An increase in price will increase total revenue.
C)A decrease in price will reduce total revenue.
D)A decrease in price will have no effect on total revenue.

Question

Quizplus · Accepted Answer

When demand is elastic, a change in price will result in a proportional change in quantity demanded. As a result, an increase in price will lead to a decrease in total revenue as customers become less willing to pay the higher price. Conversely, a decrease in price will result in an increase in total revenue as customers become more willing to purchase the product at the lower price.

If Demand Is Elastic,then