Draw a demand curve that shows an decrease in price (from P1 to P2) and the...

Draw a demand curve that shows an decrease in price (from P1 to P2) and the corresponding change in quantity demand (from Q1 to Q2) leaving the revenue unchanged.

Use the graph to show the initial and the final revenue. Make sure that the area indicating the revenue is, in fact, constant.

Add a (simple) scale to your axes and calculate the initial revenue, the loss and gain in revenue due to the price increase, and the final revenue.

Expert Solution

Rahul Sunny answered 2 years ago

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