When Demand Is Elastic, a Fall in Price Causes Total

question 253

Multiple Choice

When demand is elastic, a fall in price causes total revenue to rise because

• A)when price falls, quantity sold increases so total revenue automatically rises.
• B)the increase in quantity sold is large enough to offset the lower price.
• C)the percentage increase in quantity demanded is less than the percentage fall in price.
• D)the demand curve shifts.

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Definitions:

Reward Circuits

Neural pathways in the brain that regulate the motivation and pleasure response, critical in learning and addiction.

Pure Enjoyment

The experience of pleasure or satisfaction obtained without any ulterior motive or external incentive.

Desire

A strong feeling of wanting to have something or wishing for something to happen.

Cerebral Cortex

The outer layer of the brain's cerebrum, responsible for complex functions including thought, perception, and voluntary movement.