Figure 5-6
-Refer to Figure 5-6.For prices below $8,demand is price
A)elastic,and total revenue will rise as price rises.
B)inelastic,and total revenue will rise as price rises.
C)elastic,and total revenue will fall as price rises.
D)inelastic,and total revenue will fall as price rises.

Question

Figure 5-6 
-Refer to Figure 5-6.For prices below $8,demand is price
A)elastic,and total revenue will rise as price rises. 
B)inelastic,and total revenue will rise as price rises. 
C)elastic,and total revenue will fall as price rises. 
D)inelastic,and total revenue will fall as price rises.

Quizplus · Accepted Answer

When demand is inelastic, a price increase leads to a rise in total revenue because the percentage drop in quantity demanded is less than the percentage increase in price.

Figure 5-6 -Refer to Figure 5-6.For Prices Below $8,demand Is Price