Asked by
Shannon Brinson
on Dec 08, 2024
Verified
Refer to Figure 5.4. The demand for milkshakes is unit elastic at Point C. If the milkshake price falls from P1 to P2, total revenue will
A) increase.
B) decrease.
C) remain constant.
D) either increase or decrease.
Unit Elastic
A situation in which the percentage change in quantity demanded or supplied is exactly equal to the percentage change in price.
Total Revenue
The total revenue produced from the sales of products or services that are central to a company's main business activities.
- Study the interrelation between pricing changes and total revenue outcomes.
- Detect the elasticity phase within the demand curve (elastic, inelastic, unit elastic).
Verified Answer
ST
Learning Objectives
- Study the interrelation between pricing changes and total revenue outcomes.
- Detect the elasticity phase within the demand curve (elastic, inelastic, unit elastic).