Thursday, 11 February 2016

Cima C04 Exam Question No 42

Question No 42:

If a business currently sells 10,000 units of its product each month at $10 each unit and the demand for its product has a price elasticity of -2·5, a rise in the price of the product to $11 will?

A.
Raise total revenue by $7,250.
B.
Reduce total revenue by $17,500.
C.
Reduce total revenue by $25,000.
D.
Raise total revenue by $37,500.

Answer: B

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