Use the following for questions 116-119.
Exhibit: The Demand for Macintosh Computers

-(Exhibit: Demand for Macintosh Computers) The change in the firm's total revenue resulting from a change in price from T to P suggests that demand is:
A) nonelastic.
B) price elastic.
C) price inelastic.
D) unit price elastic.

Question

Use the following for questions 116-119.
Exhibit: The Demand for Macintosh Computers
 
-(Exhibit: Demand for Macintosh Computers) The change in the firm's total revenue resulting from a change in price from T to P suggests that demand is:
A) nonelastic. 
B) price elastic. 
C) price inelastic. 
D) unit price elastic.

Quizplus · Accepted Answer

When total revenue increases as price decreases, it indicates that the quantity demanded increases by a larger percentage than the price decreases, which is characteristic of price elastic demand.

Use the Following for Questions 116-119