What is the policy for a firm to increase the total revenue?If you increase the number of units sold at a given price, then total revenue will increase. If the price of the product increases for every unit sold, then total revenue also increases.
How can producers increase total revenue?Producers can increase total revenue by raising the price. Inelastic demand for agricultural products helps to explain why bumper crops depress the prices and total revenues for farmers. You may look at the movement of TR in the example below.
When a firm raises the price of its product what happens to its total revenue?For example, if one goes up the other will increase as well. In this case, an increase in price leads to an increase in total revenue, which is the definition of an inelastic demand curve.
In which of the following cases will total revenue increase?Answer and Explanation: Option C) is correct: price increase and demand is inelastic. The inelastic demand depicts the (%) price change is more than the change in quantity demanded. In this situation, when the price increases, the quantity demanded falls by less level, leading to an increase in total revenue.
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