Which of the following could be the price elasticity of demand for a good for which a decrease in price would increase revenue?
A)0
B)0.4
C)1
D)4

Name: Which of the following could be the price elasticity of demand for a good for which a decrease in price would increase revenue? A)0 B)0.4 C)1 D)4
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Question

Quizplus · Accepted Answer

A price elasticity of demand greater than 1 (elastic demand) means that a decrease in price will lead to a proportionally larger increase in quantity demanded, thus increasing total revenue.

Which of the Following Could Be the Price Elasticity of Demand