Use the following to answer question:
-(Figure: The Demand for e-Books)If the price of e-Books increases from $6 to $8,total revenue _____,which means that demand is _____.
A)increases;elastic
B)decreases;inelastic
C)remains constant;elastic
D)decreases;elastic

Question

Use the following to answer question: 
-(Figure: The Demand for e-Books)If the price of e-Books increases from $6 to $8,total revenue _____,which means that demand is _____.
A)increases;elastic 
B)decreases;inelastic 
C)remains constant;elastic 
D)decreases;elastic

Quizplus · Accepted Answer

According to the law of demand, when the price of a good increases, the quantity demanded decreases. In this case, if the price of e-Books increases from $6 to $8, the total revenue will decrease. This indicates that demand is elastic, as a small change in price leads to a proportionally larger change in the quantity demanded. Therefore, the correct answer is D.

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