If an increase in price leads to a decrease in total revenue,
A)demand is elastic.
B)demand is inelastic.
C)demand is unit elastic.
D)there is not enough information to determine the elasticity of demand.

Question

Quizplus · Accepted Answer

If an increase in price leads to a decrease in total revenue, then demand is elastic. This is because the decrease in demand for the product is relatively large compared to the increase in price, resulting in a net loss of revenue for the seller.

If an Increase in Price Leads to a Decrease in Total