Figure 4.2
-In Figure 4.2 at quantities smaller than Q₁
A) total revenue is falling.
B) price elasticity is greater than 1.
C) price and total revenue are directly related.
D) all of the above

Question

Figure 4.2
-In Figure 4.2 at quantities smaller than Q₁
A) total revenue is falling. 
B) price elasticity is greater than 1. 
C) price and total revenue are directly related. 
D) all of the above

Quizplus · Accepted Answer

At quantities smaller than Q₁, the price elasticity of demand is greater than 1, indicating that demand is elastic, and total revenue increases as quantity decreases.

Figure 4.2 -In Figure 4.2 at Quantities Smaller Than Q₁