Economics (AS & A Level) · Oct / Nov 2023 · Paper 11 · Question 11
9708Price elasticity, income elasticity and cross elasticity of demand
The table shows the demand schedule for textbooks. | price $ | quantity demanded | |---|---| | 50 | 0 | | 40 | 100 | | 30 | 200 | | 20 | 300 | | 10 | 400 | | 0 | 500 | What can be concluded from this information?
- AProfit would be maximised at a price of $30.
- BProfit would not change if the price rose from $20 to $30.
- CRevenue would increase if the price was decreased from $40 to $30.
- DRevenue would be maximised at a price of $40.
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Correct answer: C. Revenue would increase if the price was decreased from $40 to $30.
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