Demand for pet-grooming services decreases while supply remains unchanged. At the new equilibrium, both the price of an appointment and the number of appointments sold are lower.
Which statement about the total revenue rectangle on a demand-and-supply diagram is correct?
It becomes shorter and narrower, so total revenue falls
It becomes shorter but wider, so total revenue could rise or fall
It becomes shorter and narrower, but total revenue could rise or fall
It becomes taller but narrower, so total revenue falls
236 exam-style questions on AQA GCSE Economics 1.3 How prices are determined, covering 1.3.1a Demand and the factors that influence it, 1.3.1b The demand curve, 1.3.2a Supply and the factors that influence it, 1.3.2b The supply curve, 1.3.3a Determining equilibrium price, 1.3.3b Applying diagrams and showing revenue, 1.3.4a Complements and substitutes, 1.3.4b Effects of changes on related markets, 1.3.5a Price elasticity of demand, 1.3.5b Factors affecting price elasticity of demand, 1.3.5c Measuring PED and its implications, 1.3.6a Price elasticity of supply, 1.3.6b Factors affecting price elasticity of supply, and 1.3.6c Measuring PES and its implications. Each one has a worked solution and a mark scheme showing where the marks go.