-In the Figure Above, When the Price Falls from $8

question 37

Multiple Choice

-In the figure above, when the price falls from $8 to $7, total revenue

• A) increases from $120 to $210 so demand is inelastic.
• B) decreases from $210 to $120 so demand is inelastic.
• C) increases from $120 to $210 so demand is elastic.
• D) decreases from $210 to $120 so demand is elastic.
• E) increases from $120 to $210, but more information is needed to determine whether demand is elastic, inelastic or unit elastic.

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Definitions:

Equity

The value of an ownership interest in a company, calculated as the difference between assets and liabilities.

Assets

Resources owned by a business that have economic value and can be used to meet debts, commitments, or generate income.

Revenue

The total income generated by the sale of goods or services related to a company's primary operations before any costs or expenses are deducted.

Account Receivable

Signifies the amount of money that customers owe a company for products or services that have been provided but are still unpaid.