Answer:
B. a small percentage decrease in price produces a larger percentage increase in quantity demanded and total revenue increases.
Explanation:
Elasticity of demand measures the responsiveness of quantity demanded to changes in price.
Elasticity of demand = percentage change in quantity demanded / percentage change in price
Demand is elastic if a small percentage decrease in price produces a larger percentage increase in quantity demanded . Total revenue would increase because the percentage increase in Quanitity demanded exceeds the percentage decrease in price.
If demand is elastic, a small percentage increase in price produces a larger percentage decrease in quantity demanded and total revenue increases.
Here, total revenue falls because percentage decrease in price exceeds the percentage increase in price.
Demand is inelastic if a small percentage decrease in price produces a smaller percentage increasein quantity demanded.
Demand is perfectly inelastic if the quantity demanded remains the same regardless of level of price.
I hope my answer helps you
Sell the asset, which will drive down the price and cause the expected return to reach the level of the required return.
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When an organization produces only a single product or service and attempts to sell it to two or more market segments. It avoids the extra costs of developing and producing additional versions of the product.
For better understanding, lets explain the term
- Market segmentation is simply known as the act of gathering or aggregating known buyers into groups that have common needs and will respond almost the same to a marketing action.
- Organization that makes only a single product or service do try to avoids any extra costs that may arise because they want to focus on just one thing
From the above, we can therefore say that the answer When an organization produces only a single product or service and attempts to sell it to two or more market segments. It avoids tahe extra costs of developing and producing additional versions of the product.
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