Economics: Principles, Problems, and Policies, 19th Edition

Published by McGraw-Hill Education
ISBN 10: 0073511447
ISBN 13: 978-0-07351-144-3

Chapter 4 - Elasticity - Questions - Page 90: 6f

Answer

Total revenue would increase.

Work Step by Step

Since demand is elastic, a decrease in price would result in a more than proportionate change in quantity demanded, thus, the area of (P x Q) (which is total revenue) that is gained would be greater than the area lost. Total revenue would therefore increase.
Update this answer!

You can help us out by revising, improving and updating this answer.

Update this answer

After you claim an answer you’ll have 24 hours to send in a draft. An editor will review the submission and either publish your submission or provide feedback.