When a firm raises the price of its product, what happens to its total revenue?
A) If demand is elastic, total revenue decreases.
B) If demand is unit elastic, total revenue increases.
C) If demand is inelastic, total revenue decreases.
D) If demand is elastic, total revenue increases.
E) If demand is unit elastic, total revenue decreases.
A
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When an economy dips into recession, automatic stabilizers will tend to
a. enlarge the budget deficit (or reduce the surplus). b. reduce the budget deficit (or increase the surplus). c. ensure that the budget remains in balance. d. expand the supply of money and, thereby, stimulate aggregate demand.
Which of the following would be most likely to maintain that spending increases and larger budget deficits would help promote recovery from the recession of 2008-2009?
a. supply-side economists b. new classical economists c. Keynesian economists d. proponents of the crowding-out theory