Suppose 1000 Units of a Good Are Sold at $10

question 216

Multiple Choice

Suppose 1000 units of a good are sold at $10 a unit. If its price increases to $20 and total revenue increases to $20,000 and increases by $1000 for every dollar increase in price after that, we know that

• A) demand is perfectly elastic.
• B) the demand curve is vertical.
• C) the demand curve is downward sloping and the firm is on the inelastic portion of the demand curve.
• D) the demand curve is a rectangular hyperbola.

---

Definitions:

Marketing Environment

The outside factors and forces that affect a company’s ability to meet its marketing goals. Those forces include political, economic, demographic, sociocultural, technological, and legal factors.

Adoption Process

The sequence of steps a consumer goes through, from first becoming aware of a new product or service to finally making the purchase and using it.

Awareness

The degree of consumer recognition of a product, brand, or company, often influenced by marketing and advertising efforts.

Consumer Adoption Process

The sequence of stages a consumer goes through in embracing a new product or service, from awareness to loyalty.