Figure 13-7
-According to Figure 13-7 above,if Newsweek raises its price from $2.00 per issue to $2.50 per issue,what happens to total revenue?
A) total revenue goes up
B) total revenue goes down
C) total revenue stays the same
D) total revenue is not related to the price
E) it is impossible to tell from the information given in the figure

Question

Figure 13-7
-According to Figure 13-7 above,if Newsweek raises its price from $2.00 per issue to $2.50 per issue,what happens to total revenue?
A) total revenue goes up 
B) total revenue goes down 
C) total revenue stays the same 
D) total revenue is not related to the price 
E) it is impossible to tell from the information given in the figure

Quizplus · Accepted Answer

The point where the demand curve intersects with the original price line (P) represents the original total revenue. If the price is increased to $2.50, the quantity demanded decreases from Q1 to Q2, resulting in a lower total revenue. This is illustrated by the distance between the original total revenue and the new total revenue at the point where the new price line intersects with the demand curve. Therefore, total revenue goes down when Newsweek raises its price from $2.00 to $2.50 per issue.

Figure 13-7 -According to Figure 13-7 Above,if Newsweek Raises Its Price from Price