There is no total revenue test for price elasticity of supply because:
A) price and quantity are inversely related.
B) price and quantity are usually directly related.
C) total revenue will usually change in the direction of a supply price change.
D) both B and C are true.

Question

Quizplus · Accepted Answer

The total revenue test is not applicable for price elasticity of supply because price and quantity supplied are usually directly related (B), and total revenue typically changes in the direction of a supply price change (C), making both statements true.

There Is No Total Revenue Test for Price Elasticity of Supply