When the marginal revenue resulting from a decrease in price is negative,demand for the product is:
A)elastic.
B)unit elastic.
C)inelastic.
D)cannot be determined without more information.

Question

Quizplus · Accepted Answer

When the marginal revenue resulting from a decrease in price is negative, it means that the total revenue decreases as a result of a price cut. This implies that the demand for the product is inelastic, as consumers are not very responsive to changes in price.

When the Marginal Revenue Resulting from a Decrease in Price