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Figure 5-9 -Refer to Figure 5-9.Suppose This Demand Curve Is a Straight,downward-Sloping

Question 232

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Figure 5-9
Figure 5-9 -Refer to Figure 5-9.Suppose this demand curve is a straight,downward-sloping line all the way from the horizontal intercept to the vertical intercept.We choose two prices,P₁ and P₂,and the corresponding quantities demanded,Q₁ and Q₂,for the purpose of calculating the price elasticity of demand.Also suppose P₂ > P₁.In which of the following cases could we possibly find that (i) demand is elastic and (ii) an increase in price from P₁ to P₂ causes an increase in total revenue? A) 0 < P1 < P2 < $10. B) $10 < P1 < P2 < $15. C) P1 > $15. D) None of the above is correct.
-Refer to Figure 5-9.Suppose this demand curve is a straight,downward-sloping line all the way from the horizontal intercept to the vertical intercept.We choose two prices,P₁ and P₂,and the corresponding quantities demanded,Q₁ and Q₂,for the purpose of calculating the price elasticity of demand.Also suppose P₂ > P₁.In which of the following cases could we possibly find that (i) demand is elastic and (ii) an increase in price from P₁ to P₂ causes an increase in total revenue?


A) 0 < P1 < P2 < $10.
B) $10 < P1 < P2 < $15.
C) P1 > $15.
D) None of the above is correct.

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