If Total Revenue Does Not Change as a Result of a Rise

question 176

Multiple Choice

If total revenue does not change as a result of a rise in the price of a given good, it follows that demand is

• A)perfectly elastic.
• B)perfectly inelastic.
• C)unit elastic.
• D)inelastic.
• E)elastic.

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Definitions:

Expected Payoff

In decision theory and economics, it is the average of all possible outcomes, each weighted by its probability of occurrence.

Perfect Information

A situation in decision theory and economics where all parties have full and identical information about all aspects of the situation.

Car Audio Store

A retail business specializing in the sale of audio systems and accessories for vehicles.

Expected Value

The predicted value of a variable, computed as the sum of all possible values each multiplied by the probability of its occurrence.