# An increase in the price of a good will cause total

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Question 3.Question :An increase in the price of a good will cause total revenue to fall ifprice elasticity of demand is:Student Answer:elastic. (Correct!)
inelastic. unitary elastic. perfectly elastic. Instructor Explanation:The relationship between total revenue and elasticity is discussed on pages 78 and 79 in the text. “If demand is elastic, a decrease in price will increase total revenue . . . If demand is elastic, a price increase will reduce total revenue.” Likewise, “If demand is inelastic, a price decrease will reduce total revenue . .. If demand is inelastic, a price increase will increase total revenue.” Finally, “In the special case of unit elasticity, an increase or a decrease in price leaves total revenue unchanged.”
Points Received:1 of 1 Comments:Question 4.Question :Which is not characteristic of a product with relatively inelastic demand?
Points Received:1 of 1 Comments:Question 5.Question :If in the short run the demand for mass transit is inelastic and in the long run the demand is elastic, then a price:
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