At a price of $20, a store can sell 24 picture frames a day. At a price of $18 the store can sell 33 picture frames a day. Since total revenue ________ by the price decrease, demand must be ________.
A) is increased; elastic
B) is increased; inelastic
C) is increased; unit elastic
D) is decreased; elastic

Question

Quizplus · Accepted Answer

The total revenue at $20 is $480 (24 frames * $20), and at $18 it is $594 (33 frames * $18), showing an increase in revenue with a price decrease, indicating elastic demand.

At a Price of $20, a Store Can Sell 24