Total Revenue Falls as the Price of a Good Decreases

question 41

Multiple Choice

Total revenue falls as the price of a good decreases if the price elasticity of demand is

• A)Elastic
• B)Inelastic
• C)Unitary elastic
• D)Perfectly inelastic

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Definitions:

Risk Lover

An individual or entity that prefers or is willing to undertake actions with a higher level of uncertainty or risk.

Expected Value

The weighted average of all possible values that a random variable can take on, with weights being the probabilities of each outcome.

Expected Value

The forecasted value of a variable, determined by adding together all potential values, each weighted by its likelihood of happening.

Risk Neutral

A situation or attitude where an individual or entity is indifferent to risk when making a decision.