Week 3 DQ 1.docx - For this scenario it would be beneficial...

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For this scenario, it would be beneficial for a marketing manager to understand how inelastic and elastic demand work. Inelastic demand is when elasticity is less than one and results in consumers not caring too much about a change in price. Elastic demand is different in which elasticity is greater than one and results in a larger change in quantity demanded which a change in price occurs. If the company’s goal is to increase total revenue, then it would be best to not increase price when facing an elastic demand. Total revenue will decrease because of the decrease in quantity demanded. People simply will be less interested in this product when price changes. On the other hand, a price increase when being faced with inelastic demand would increase total revenue because the change in price in greater than the change in quantity
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