If demand is elastic, an increase in price will have an indeterminate effect on total revenue.

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If demand is elastic, an increase in price will lead to a decrease in quantity demanded, resulting in a decrease in total revenue. Conversely, a decrease in price will lead to an increase in quantity demanded and total revenue. If demand is elastic, an increase in price will lead to a decrease in quantity demanded which will decrease total revenue. Similarly, a decrease in price will lead to an increase in quantity demanded which will increase total revenue. Therefore, the effect of price changes on total revenue can be determined based on the relative magnitudes of the percentage change in price and quantity demanded. If the percentage change in quantity demanded is greater than the percentage change in price, total revenue will decrease and if the percentage change in quantity demanded is less than the percentage change in price, total revenue will increase.

If Demand Is Elastic, an Increase in Price Will Have