If the demand curve is perfectly elastic, and if the price of the good is increased by 10 percent by the seller, then revenue from the sale of the good would
A)remain constant.
B)fall to zero.
C)increase by 10 percent.
D)decrease by 10 percent.

Question

Quizplus · Accepted Answer

When the demand curve is perfectly elastic, consumers are perfectly price sensitive, meaning any increase in price will cause the quantity demanded to drop to zero, hence revenue would fall to zero.

If the Demand Curve Is Perfectly Elastic, and If the Price