객관식
Use this graph to answer the following questions.
What is the elasticity of demand when the price of the good changes from \$3 to \$5?
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4. Elasticity
Total Revenue Along a Linear Demand Curve
객관식
Use this graph to answer the following questions.
At what price is revenue maximized?
A
\$2
B
\$3
C
\$4
D
\$5
검증된 단계별 안내1
Identify the demand curve on the graph, which shows the relationship between price (P) and quantity (Q).
Understand that total revenue (TR) is calculated as the product of price (P) and quantity (Q), i.e., TR = P * Q.
To find the price at which revenue is maximized, recognize that revenue is maximized at the midpoint of the linear demand curve, where the price elasticity of demand is unitary (elasticity = 1).
Locate the midpoint of the demand curve on the graph. This is the point where the curve is divided into two equal halves.
Determine the price corresponding to this midpoint on the graph, which is the price at which revenue is maximized.
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