Answer:
<u><em> Price falls and demand is inelastic.</em></u>
<em>Decrease</em> as the amount demanded will be the same but the revenue fro mthis quantity will be lower.
<u><em> Price rises and demand is inelastic.</em></u>
Increase as the quantity demanded will be the same but at a higher price per unit.
<u><em> Price rises and demand is elastic.</em></u>
Decrease as the decrease in demand will negate the price increase
<em><u>Price falls and demand is elastic</u></em>
Increase as the decrease in prince will make the quantity increase in a higher proportion than the decrease in sales, therefore make a higher revenue
<em><u>Price falls and demand is of unit-elasticity.</u></em>
unchanged as the price and quantity effect cancel each other.
Explanation:
Being total Revenue: Price Sales x Quantity
and being Quantity a function of Sales price
we can derivate that Total revenue :
P + f(P)
And end with the following expression:
Q(1 - Ed) = total revenue efffect
when the demadn is inelastic (<1) this will be positive thus, they move in the same directins.
While, if elastic then (>1) making the otal revenue negative they move in opposite direction
Last if equal to one then, the increase is zero, ther eis no change