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    Question

    In terms of economics, demand would be inelastic when

    A increase in price of samosa leads to increase in total revenue. Correct Answer Incorrect Answer
    B increase in price of samosa leads to decrease in total revenue. Correct Answer Incorrect Answer
    C increase in price of samosa by 10% leads to fall in quantity demanded by 10%. Correct Answer Incorrect Answer
    D None of these Correct Answer Incorrect Answer

    Solution

    Total revenue (Price × Quantity) increases when price is increased only if the percentage change in quantity demanded is less than the percentage change in price. This is the definition of inelastic demand (% change Qd < % change P).

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