When demand is inelastic within a certain price range,then within that price range,
A) an increase in price would increase total revenue because the decrease in quantity demanded is proportionately less than the increase in price.
B) an increase in price would decrease total revenue because the decrease in quantity demanded is proportionately greater than the increase in price.
C) a decrease in price would increase total revenue because the increase in quantity demanded is proportionately smaller than the decrease in price.
D) a decrease in price would not affect total revenue.

Question

Quizplus · Accepted Answer

When demand is inelastic within a certain price range, it means that the quantity demanded does not change significantly when the price changes. In this situation, an increase in price would result in a proportionately smaller decrease in quantity demanded. As a result, the increase in price would lead to an increase in total revenue. On the other hand, a decrease in price would result in a proportionately smaller increase in quantity demanded, and therefore, total revenue would also increase. However, choice A is the best answer, as it specifically addresses an increase in price within the price range of inelastic demand.

When Demand Is Inelastic Within a Certain Price Range,then Within