a-company-increases-the-price-of-its-product-from-15-to-20-and-total-revenue-dec

Question

A company increases the price of its product from $$15 to 20$$, and total revenue decreases. What should the company do to maximize revenue?

Accepted Answer

Decrease the price, as demand is elastic.

Answer

Increase the price further, as demand is inelastic.

Answer

Discontinue the product, as demand is perfectly elastic.

Answer

Maintain the current price, as demand is unit elastic.

A company increases the price of its product from \$15 to \$20, and total revenue decreases. What should the company do to maximize revenue?