Other Things Equal, If a Firm Finds the Demand for One

question 148

Multiple Choice

Other things equal, if a firm finds the demand for one of its products is inelastic, it can INCREASE its total revenues by:

• A)reducing fixed costs.
• B)reducing variable costs.
• C)raising its price.
• D)lowering its price.

---

Definitions:

Causation

A relationship between two events where one directly affects or brings about the change in the other.

Correlation

A measure of the relationship between two or more variables, indicating how one may predict or relate to the other.

Text Message

A short electronic message sent over a cellular network from one cell phone to another.

Positive Correlation

A relationship between two variables where both variables move in the same direction, meaning as one variable increases, the other variable also increases.