As the price of cell phones fell during the last decade, consumers' total expenditures on cell phones increased. If the demand curve for cell phones did not shift, this fact means that the demand for cell phones
A) must have shifted leftward.
B) must be upward sloping.
C) is elastic.
D) is inelastic.

Question

Quizplus · Accepted Answer

When the price of a good falls and total expenditures increase, it indicates that the demand for the good is elastic. This means that the percentage increase in quantity demanded is greater than the percentage decrease in price, leading to an increase in total revenue.

As the Price of Cell Phones Fell During the Last