Which of the Following Occurs When Price Is Inelastic

question 67

Multiple Choice

Which of the following occurs when price is inelastic?

• A) Price and revenue change in the same direction.
• B) Revenues decrease when price increases.
• C) Revenue is unaffected by price changes.
• D) Quantity demanded increases when price increases.
• E) The demand curve is more horizontal.

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Definitions:

Long Run

An economic phase where all production elements and expenses can adjust completely, adapting to changes due to their variable nature.

Variable Inputs

Production factors that can be adjusted in the short term to change the level of output, such as labor and raw materials.

Short Run

A period of time in which at least one input in the production process is fixed, influencing decisions made by firms about production levels.

Plant Capacity

Plant capacity refers to the maximum output a manufacturing or production facility can achieve under normal conditions within a given time period.