In the market for computers,if the demand curve is elastic and the price of a computer decreases,we expect total revenue to _.If the demand curve is inelastic and the price of a computer decreases,we expect total revenue to _.

A) increase;decrease
B) increase;increase
C) decrease;increase
D) decrease;decrease

Question

In the market for computers,if the demand curve is elastic and the price of a computer decreases,we expect total revenue to _____.If the demand curve is inelastic and the price of a computer decreases,we expect total revenue to _____.

A) increase;decrease
B) increase;increase
C) decrease;increase
D) decrease;decrease

Katera Henderson · Accepted Answer

Final Answer : A, Explanation :  When demand is elastic, a decrease in price leads to a proportionally larger increase in quantity demanded, raising total revenue. Conversely, when demand is inelastic, a decrease in price doesn't lead to a sufficient increase in quantity demanded to offset the lower price, thus reducing total revenue.

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