If the Price Is Reduced from $100 to $80 in Figure

question 115

Multiple Choice

If the price is reduced from $100 to $80 in Figure 20.1, ceteris paribus,

• A) Total revenue will decrease.
• B) Demand will increase.
• C) Quantity demanded will decrease.
• D) Total revenue will increase.

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Definitions:

Maximize

To increase or make as large or great as possible, often used in the context of mathematical optimization.

Minimize

To reduce to the smallest possible amount or degree.

Constraints

Restrictions or limitations on the variables of a problem which define the conditions or boundaries within which a solution must be found.

Experimental Statistical Study

A research method involving the manipulation of one variable to determine if changes in one variable cause changes in another variable.