The Marketing People for AT&T Believe That If They Lower

Multiple Choice

The marketing people for AT&T believe that if they lower the price of long-distance phone calls by 5 percent, their quantity demanded will increase by 15 percent. If they are correct in their belief, then

A) the demand for long-distance phone calls is price inelastic.
B) the total revenue from long-distance phone calls will increase if they lower the price.
C) the demand for long-distance phone calls is income elastic.
D) the total revenue from long-distance phone calls will decrease if they lower the price.