5. When a product price is elastic does a drop in price result in
an increase or decrease in earnings?

The three possibilities are laid out in Table 1. If demand is elastic at that price level, then the band should cut the price, because the percentage drop in price will result in an even larger percentage increase in the quantity sold—thus raising total revenue.

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john social contacted the noble of religous

changes in factors like average income and preferences can cause an entire demand curve to shift right or left. this causes a higher or lower quantity to be demanded at a given price. demand curves relate the prices and quantities demanded assuming no other factors change. it is important for consumers to know this information, because it is crucial for them to know what they can afford and can't afford. i hope this .