Total revenue decreases as output increases when demand is:
A)downward sloping.
B)perfectly elastic.
C)price inelastic.
D)price elastic.

Question

Quizplus · Accepted Answer

Total revenue decreases as output increases when demand is price inelastic because consumers are not very responsive to price changes, so increasing output leads to a proportionally smaller increase in revenue, or even a decrease if the price has to be significantly reduced to sell the additional output.

Total Revenue Decreases as Output Increases When Demand Is