When demand is inelastic,the price elasticity of demand is
A)less than 1,and price and total revenue will move in the same direction.
B)less than 1,and price and total revenue will move in opposite directions.
C)greater than 1,and price and total revenue will move in the same direction.
D)greater than 1,and price and total revenue will move in opposite directions.

Question

Quizplus · Accepted Answer

When demand is inelastic, the price elasticity of demand is less than 1. This means that a change in price will result in a proportionately smaller change in quantity demanded. As a result, price and total revenue will move in the same direction. When price increases, total revenue will also increase, and when price decreases, total revenue will decrease.

When Demand Is Inelastic,the Price Elasticity of Demand Is