-If the price is reduced from $100 to $80 in Figure 20.1,ceteris paribus,
A)Total revenue will decrease.
B)Demand will increase.
C)Quantity demanded will decrease.

Question

-If the price is reduced from $100 to $80 in Figure 20.1,ceteris paribus,
A)Total revenue will decrease. 
B)Demand will increase. 
C)Quantity demanded will decrease.

Quizplus · Accepted Answer

When the price decreases from $100 to $80, total revenue will decrease if the demand is inelastic, as the percentage drop in price will outweigh the percentage increase in quantity demanded.

-If the Price Is Reduced from $100 to $80 in Figure