When demand is price-inelastic, ceteris paribus, an increase in
A. Price leads to greater total revenue.
B. Total revenue indicates a reduction in price.
C. Price leads to lower total revenue.
D. Total revenue means quantity rises.
Answer: A
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Which of the following biases the CPI to underestimate increases in prices?
a. The substitution bias b. The quality bias c. The new outlet bias d. None of the above
If the price of gasoline rises, when is the price elasticity of demand likely to be the highest?
a. immediately after the price increases b. one month after the price increase c. three months after the price increase d. one year after the price increase
The largest U.S. economic downturn between 1890 and the present occurred during which of the following events?
a. The Buffalo Head Nickel Panic b. The Rich Man's Panic c. The Great Depression d. The Great Banana Crisis of 1897
One major reason that economists are concerned about unemployment is that
A. unemployment reduces the size of the labor force. B. the economy is producing less output than if there were full employment. C. unemployment always leads to frictional unemployment. D. unemployment shifts the production possibilities curve outward.