An increase in total revenue will result if
A) demand is inelastic and price increases.
B) demand is elastic and price increases.
C) demand is inelastic and price decreases.
D) demand is unitary elastic and price decreases.

Question

Quizplus · Accepted Answer

If demand is inelastic, then a price increase will result in a relatively small decrease in quantity demanded. As a result, the increase in price will more than offset the decrease in quantity demanded, leading to an increase in total revenue.

An Increase in Total Revenue Will Result If