If the demand for a good is unit elastic and the price of the good increases, then
A)total revenue increases.
B)total revenue decreases.
C)total revenue is not affected.
D)the direction of the change in total revenue cannot be determined from the information given.

Question

Quizplus · Accepted Answer

When demand is unit elastic, a price increase does not affect total revenue because the percentage change in quantity demanded exactly offsets the percentage change in price.

If the Demand for a Good Is Unit Elastic and the Price