Related to the Economics in Practice on page 102: Harriet runs a corner delicatessen and one day decides to raise her prices by 20 percent. Total revenue is likely to ________ when she first raises prices since demand is relatively ________ in the short term.
A) rise; inelastic
B) fall; inelastic
C) rise; elastic
D) fall; elastic

Question

Quizplus · Accepted Answer

Total revenue is likely to rise when prices are increased if the demand is inelastic in the short term, meaning consumers' purchasing behavior does not change significantly with a price increase.

Related to the Economics in Practice on Page 102: Harriet