00:01
Hello students, we are given a question here which statement is true about the price elasticity of demand along the downward sloping linear demand curve.
00:10
So we are given here some options.
00:13
First of all, we will understand that when the price changes, when the price, the price changes, the change in quantity sold, the change in a quantity, quantity, sold may increase or decrease okay may increase or decrease or decrease the total decrease the total revenue total revenue depending on the elasticity of the product depending on the elasticity okay students elasticity of a product further we are supposed to know that here, what we can state that here, when the demand is inelastic, we can say that here that when demand is a is a inelastic.
01:30
Okay, students, the total revenue changes in the same direction.
01:34
Total revenue tr changes in the same direction.
01:46
Students direction as prices as prices and since we can say that this is the price changes more than since the price change more than compensates more than compensates for the change in quantity for the for the change in a in a quantity okay, students, which is represented by a steep demand curve, which is represented by steep demand curve.
02:39
Steep demand curve.
02:42
Okay, students, further, we are supposed to know that here what we can state that so raising prices increases revenue.
02:53
Hence raising prices okay students raising prices increases the revenue increases revenue and elastic demand is more sensitive you can say that elastic demand is a more sensitive okay students more sensitive to price to price so small so small changes in price small changes in a price okay students results in larger changes in here we can write that the results in a larger changes larger changes in a quantity okay students and changing revenue in the opposite direction to the prices so and we can write here changing changing revenue in the opposite direction in the opposite direction to prices so basically we can say that hence increasing prices decreases revenue increasing prices decreases revenue so basically what we can state from this point now we will go to the options.
04:44
It is unit elastic.
04:46
We can say that it is unit elastic throughout the demand curve...