Suppose the Price of a Good Is $5 and Quantity

question 29

Multiple Choice

Suppose the price of a good is $5 and quantity demanded is 10 units. When price increases to $6, quantity demanded decreases to 9 units. What happened to total revenue and what does this indicate?

• A) Total revenue decreased from $54 to $50, indicating that demand is inelastic.
• B) Total revenue decreased from $54 to $50, indicating that demand is elastic.
• C) Total revenue increased from $50 to $54, indicating that demand is inelastic.
• D) Total revenue increased from $50 to $54, indicating that demand is elastic.

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Definitions:

Internal Variable

Internal variable typically refers to a factor within a system or organism that can change and influence processes or outcomes, such as in psychological or biological contexts.

Cultural Background

The societal, ethnic, linguistic, and familial influences that shape an individual's identity and worldview.

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A bulge or protrusion near the belly button that occurs when part of the intestine, fat, or fluid pushes through a weak spot in the abdominal muscles.

Silver Dollar

A coin traditionally made from silver that has variously served as legal tender in the United States.