Given a linear demand curve, at which combination of price and marginal revenue (P, MR) is the price elasticity of demand greater than 1?
A) P = 15, MR = 8
B) P = 12, MR = 0
C) P = 8, MR = −2
D) P = 4, MR = −4

Question

Quizplus · Accepted Answer

When the price elasticity of demand is greater than 1, demand is elastic, and marginal revenue is positive. In option A, MR is positive, indicating elastic demand.

Given a Linear Demand Curve, at Which Combination of Price