The following figure shows price versus quantity for a market.

-Refer to the figure above.On what interval of quantity does total revenue decrease when quantity increases?
A) From 0 to Q₂
B) From Q₁ to Q₂
C) From Q₂ to infinity
D) Total revenue never decreases when quantity increases

Question

The following figure shows price versus quantity for a market.
 
-Refer to the figure above.On what interval of quantity does total revenue decrease when quantity increases?
A) From 0 to Q₂ 
B) From Q₁ to Q₂ 
C) From Q₂ to infinity 
D) Total revenue never decreases when quantity increases

Quizplus · Accepted Answer

Total revenue decreases when quantity increases beyond Q₂, as this is typically where the demand curve becomes inelastic, causing revenue to fall with additional quantity.

The Following Figure Shows Price Versus Quantity for a Market