Sellers can increase their revenue when they decrease price on their products which have inelastic demand.

Question

Quizplus · Accepted Answer

When the demand for a product is inelastic, a decrease in price will not significantly increase the quantity demanded. Therefore, decreasing the price may not necessarily result in an increase in revenue, as the increase in sales may be offset by the decrease in price. In such cases, sellers may be better off keeping the price high and earning a higher profit margin, rather than trying to increase sales volume by reducing the price.

Sellers Can Increase Their Revenue When They Decrease Price on Their