Question

When heavy rain ruined the banana crop in central​ america, the price of bananas rose from ​$0.90 a pound to ​$1.10 a pound. banana sellers sold fewer​ bananas, but their total revenue remained unchanged. the quantity of bananas ▼ decreased increased by nothing percent?

Answer 1

Answer: Total revenue is given by

$TR=P*Q$

When price of bananas increase from $0.90 to $1.10 a pound and total revenue remained unchanged, it means that the quantity of Bananas sold must have decreased.

Suppose at $0.90 we sold 10 pound bananas getting us $9 revenue.

This means that at $1.10 we have to sell 8 Banana's to get the same amount of revenue.

So, change in quantity = $= \frac{10-8}{10} = 20%$

So, their is a decline of 20% in the quantity of Bananas sold.