If a price increase leads to a reduction in total revenue, then the price elasticity of demand due to the price change is
A) inelastic.
B) elastic.
C) unitary elastic.
D) perfectly inelastic.

Question

Quizplus · Accepted Answer

When a price increase leads to a reduction in total revenue, it indicates that the quantity demanded decreases by a proportion greater than the proportion of the price increase, which is characteristic of elastic demand.

If a Price Increase Leads to a Reduction in Total