Suppose that a new drug has been approved to treat a life-threatening disease.Demand for that drug is shown on the graph below.Prior to approval of this drug,the only treatment for this condition was non-prescription pain relief.Demand for one brand of non-prescription pain reliever is also shown on the graph below.
Refer to the figure above.The manufacturer of the pain reliever would _______ total revenue by increasing the price from $15 to $25.
A) increase
B) decrease,but continue to earn some
C) experience no change
D) completely eliminate

Question

Suppose that a new drug has been approved to treat a life-threatening disease.Demand for that drug is shown on the graph below.Prior to approval of this drug,the only treatment for this condition was non-prescription pain relief.Demand for one brand of non-prescription pain reliever is also shown on the graph below. 
Refer to the figure above.The manufacturer of the pain reliever would _______ total revenue by increasing the price from $15 to $25.
A) increase 
B) decrease,but continue to earn some 
C) experience no change 
D) completely eliminate

Quizplus · Accepted Answer

The demand curve for the pain reliever intersects the axis at $20.

Suppose That a New Drug Has Been Approved to Treat