What is the total revenue test? The total revenue test is a method of estimating the price elasticity of demand by observing the __ that results from __ when all other influences on the quantity sold remain the same. A. change in total revenue; a change in the price B. change in the quantity demanded; a change in the price A. total revenue; the quantity sold at a given price

## Step 1<br />The total revenue test is a method used to estimate the price elasticity of demand. This test involves observing the change in total revenue that results from a change in price, assuming all other factors influencing the quantity sold remain constant.<br /><br />## Step 2<br />The total revenue test is based on the assumption that if the price of a product increases and the quantity demanded decreases proportionally, the total revenue will remain the same. This is because the increase in price is offset by the decrease in quantity demanded.<br /><br />## Step 3<br />Similarly, if the price of a product decreases and the quantity demanded increases proportionally, the total revenue will also remain the same. This is because the decrease in price is offset by the increase in quantity demanded.<br /><br />## Step 4<br />Therefore, the total revenue test is a method of estimating the price elasticity of demand by observing the change in total revenue that results from a change in price, assuming all other factors influencing the quantity sold remain constant.