Assume the Demand for Coffee Is Inelastic

question 10

Multiple Choice

Assume the demand for coffee is inelastic. If the price of coffee increases, total revenue

• A) decreases.
• B) remains constant.
• C) increases.
• D) is negative.

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Definitions:

Ratio

A quantitative relationship between two numbers showing how many times the first number contains the second.

Proportion

A part, share, or number considered in comparative relation to a whole.

Overhead

The ongoing business expenses not directly attributed to creating a product or service, such as rent, utilities, and administrative costs.

Lowest Terms

The equivalent ratio having the smallest possible integers for its terms.