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Solution:
he answer is (b) Demand is elastic and price rises. When demand is elastic, a small change in price leads to a large change in quantity demanded.
So, when the price rises, the quantity demanded falls by a large amount. However, since the demand is elastic, the percentage fall in quantity demanded is greater than the percentage rise in price.
As a result, total consumer expenditure falls. Similarly, when the price falls, the quantity demanded rises by a large amount. However, since the demand is elastic, the percentage rise in quantity demanded is greater than the percentage fall in price.
As a result, total consumer expenditure rises .
According to module correct answer is option (d)
Correct option is (b)