Which of the following occurs when price is inelastic?
A) Price and revenue change in the same direction.
B) Revenues decrease when price increases.
C) Revenue is unaffected by price changes.
D) Quantity demanded increases when price increases.
E) The demand curve is more horizontal.

Question

Quizplus · Accepted Answer

When demand is inelastic, a price increase leads to a smaller percentage decrease in quantity demanded, resulting in an increase in total revenue. Conversely, a price decrease leads to a smaller percentage increase in quantity demanded, decreasing total revenue.

Which of the Following Occurs When Price Is Inelastic