Price and total revenue are inversely related (i.e. when price rises revenue falls) when demand is inelastic.

Name: Price and total revenue are inversely related (i.e. when price rises revenue falls) when demand is inelastic.
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Question

Quizplus · Accepted Answer

When demand is inelastic, an increase in price typically leads to an increase in total revenue because the percentage decrease in quantity demanded is less than the percentage increase in price, meaning consumers are relatively unresponsive to price changes in this scenario.

Price and Total Revenue Are Inversely Related (I