ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -If the price for an inelastic good is lowered, the demand for that good does not increase, resulting in less overall revenue due to the lower price and no change in demand. This would indicate that the firm should not reduce the price of its goods as there is no beneficial outcome in doing so.

Detailed explanation-2: -b) If demand is price elastic, then decreasing price will increase revenue.

Detailed explanation-3: -If demand is inelastic, an increase in price will cause total revenue to increase. If demand is inelastic, a decrease in price will cause total revenue to fall. If demand is elastic, an increase in price will cause total revenue to fall. If demand is elastic, a decrease in price will cause total revenue to rise.

Detailed explanation-4: -Elastic demand or supply curves indicate that the quantity demanded or supplied responds to price changes in a greater than proportional manner. An inelastic demand or supply curve is one where a given percentage change in price will cause a smaller percentage change in quantity demanded or supplied.