One winter recently, the price of antique furniture increased by 20 percent and the quantity demanded decreased by 30 percer Use the total revenue test to determine whether the demand for antique furniture is elastic or inelastiC. Total revenue __ because the percentage increase in the price is __ than the percentage decrease in the quantity demanded. A. does not change less B. increases; greater C. decreases; less D. decreases; greater E. increases; less

## Step 1<br />The total revenue test is a method used to determine whether the demand for a product is elastic or inelastic. This test involves comparing the percentage change in price to the percentage change in quantity demanded.<br /><br />## Step 2<br />In this case, the price of antique furniture increased by 20 percent and the quantity demanded decreased by 30 percent. <br /><br />## Step 3<br />The total revenue is calculated by multiplying the price by the quantity. If the total revenue increases, it means that the percentage increase in price is greater than the percentage decrease in quantity demanded. This indicates that the demand is inelastic.<br /><br />## Step 4<br />On the other hand, if the total revenue decreases, it means that the percentage increase in price is less than the percentage decrease in quantity demanded. This indicates that the demand is elastic.<br /><br />## Step 5<br />In this case, the total revenue increases because the percentage increase in price is greater than the percentage decrease in quantity demanded. This indicates that the demand for antique furniture is inelastic.