Figure 5-4
-Refer to Figure 5-4.If the price decreases in the region of the demand curve between points A and B,we can expect total revenue to
A)increase.
B)stay the same.
C)decrease.
D)first decrease,then increase until total revenue is maximized.

Question

Figure 5-4 
-Refer to Figure 5-4.If the price decreases in the region of the demand curve between points A and B,we can expect total revenue to
A)increase. 
B)stay the same. 
C)decrease. 
D)first decrease,then increase until total revenue is maximized.

Quizplus · Accepted Answer

In the region between points A and B on the demand curve, if the price decreases, the demand is likely elastic, meaning that the percentage increase in quantity demanded will be greater than the percentage decrease in price, leading to an increase in total revenue.

Figure 5-4 -Refer to Figure 5-4.If the Price Decreases in the Region