When demand is elastic, a fall in price causes total revenue to rise because
A) the percentage increase in quantity demanded is less than the percentage fall in price.
B) the demand curve shifts.
C) when price falls, quantity sold increases so total revenue automatically rises.
D) the increase in quantity sold is large enough to offset the lower price.
D
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Everything else held constant, if aggregate output is to the ________ of the IS curve, then there is an excess demand of goods which will cause aggregate output to ________
A) right; fall B) right; rise C) left; fall D) left; rise
There are certain variables that are so obviously related to past crises that they may serve as warning indicators of potential future crises. Identify one such variable from the following
a. Barriers to trade b. Short-term international investment c. Flexible exchange rates d. Rising international reserves e. Fluctuating share prices
Congresswoman Gaga represents a state in which several firms manufacture furniture. She wants to impose tariffs on all imported furniture. Which of the following is the least likely consequence of such tariffs?
a. Domestic furniture buyers will lose consumer surplus, have less variety, and will pay higher prices. b. Domestic furniture producers will gain producer surplus. c. Domestic furniture producers will have a higher rate of technological advance. d. Domestic furniture producers will have more market power.
Which of the following will discourage investment?
What will be an ideal response?