Relationship PED and total revenue Flashcards
1
Q
If product is price elastic and there’s a PRICE INCREASE …
What will will happen to demand and revenue
A
demand will fall and revenue willfall
2
Q
If product is price elastic and there’s a PRICE DECREASE…
What will will happen to demand and revenue
A
Demand will rise and revenue will rise
3
Q
If product is price inelastic and there’s a PRICE INCREASE…
What will will happen to demand and revenue
Overall
A
will only be a small fall in demand/ stay the same but overall revenues will rise
4
Q
If product is price inelastic and there’s a PRICE DECREASE…
What will will happen to demand and revenue
( re read and right)
A
demand will only increase a small amount/stay the same. Revenues will fall.
