Asked by Gisselle Ochoa on Jul 25, 2024
Verified
When demand is inelastic, an increase in price will result in an increase in total revenue.
Inelastic Demand
A situation where the demand for a good or service is relatively unresponsive to changes in price.
Total Revenue
The total income received by a firm from sales of its products or services.
Increase
A rise or growth in quantity, size, number, or some other measure.
- Scrutinize how price alterations impact total sales revenue, taking into account the elasticity of demand.
Verified Answer
RK
Ramesh KannanJul 29, 2024
Final Answer :
True
Explanation :
When demand is inelastic, consumers are less sensitive to price changes, so an increase in price will lead to a smaller percentage decrease in quantity demanded, thereby increasing total revenue.
Learning Objectives
- Scrutinize how price alterations impact total sales revenue, taking into account the elasticity of demand.
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