True or false: ceteris paribus, an increase in price will most likely decrease total revenue if the price elasticity of demand is 1.8?
Price Elasticity of Demand:
Price elasticity of demand measures the sensitivity of quantity demanded with respect to price changes. If the elasticity is greater than one, the demand is elastic and if it is less than 1, the demand is inelastic.
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fromChapter 2 / Lesson 11
In microeconomics, the principle of price elasticity of demand is important to understand. Learn the definition of price elasticity of demand, understand the formula and its categories, and see some calculation examples.