If the Elasticity of Demand for a Service Is 0

question 96

Multiple Choice

If the elasticity of demand for a service is 0.4 and price is raised,

• A)total revenue will fall.
• B)total revenue will rise.
• C)total revenue will stay the same.
• D)there is no way to determine whether total revenue will rise,fall,or remain the same.

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Definitions:

Credit

A financial arrangement where a borrower receives something of value now and agrees to repay the lender at a later date, generally with interest.

Double-entry System

An accounting system where every transaction is recorded in at least two accounts, with debits equaling credits, ensuring the accounting equation is always in balance.

Revenues

The total income generated from the sale of goods and services before any expenses are subtracted.

Expenses

Economic costs that a company incurs through its operations to generate revenue, often categorized as operational, selling, and administrative expenses.