Answer to Question #294419 in Microeconomics for Chorn Bunthean

Question

Describe what will happen to total revenue in the following situations.

a. Price decreases and demand is elastic.

b. Price decreases and demand is inelastic.

c. Price increases and demand is elastic.

d. Price increases and demand is inelastic.

e. Price increases and demand is unitary elastic.

f. Price decreases and demand is perfectly inelastic.

g. Price increases and demand is perfectly elastic.

Answer 1

a) Total revenue will increase.

b) Total revenue decreases.

c) Total revenue decreases.

d) Total revenue increases.

e) Total revenue remains unchanged.

f) Total revenue decreases.

g) Total revenue decreases.