Figure 5-11
-Refer to Figure 5-11.An increase in price from $30 to $35 would
A) increase total revenue by $250
B) decrease total revenue by $250.
C) increase total revenue by $500.
D) decrease total revenue by $500.

Question

Figure 5-11 
-Refer to Figure 5-11.An increase in price from $30 to $35 would
A) increase total revenue by $250 
B) decrease total revenue by $250. 
C) increase total revenue by $500. 
D) decrease total revenue by $500.

Quizplus · Accepted Answer

An increase in price from $30 to $35 would decrease total revenue by $250 because the demand is likely elastic in this range, meaning the percentage drop in quantity demanded is greater than the percentage increase in price.

Figure 5-11 -Refer to Figure 5-11.An Increase in Price from $30 to from $30