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What Is the Effect of a 10 Percent Price Increase

Question 92

Multiple Choice

What is the effect of a 10 percent price increase on total revenue if elasticity is larger than zero but less than 1?


A) Revenue increases by 10 percent.
B) Revenue increases by less than 10 percent.
C) Revenue does not change.
D) Revenue decreases.
E) Revenue drops to 0.

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