Does Increasing Prices Increase Revenue with Demand Q = 30 - 3P?

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To determine if increasing prices will increase revenue given the demand equation Q = 30 – 3P, one must analyze the relationship between price (P) and quantity demanded (Q). Revenue (R) is calculated as R = P * Q. As price increases, quantity demanded decreases due to the negative relationship in the demand equation. To assess the impact on revenue, one can derive the revenue function from the demand equation, substituting Q into the revenue formula. This analysis will reveal whether higher prices lead to increased revenue or not, depending on the elasticity of demand. Understanding this relationship is crucial for making informed pricing decisions.
chickenlips
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Hello~

I new here and I'd like a little help please.

Here is the question:
Suppose demand is given by Q = 30 – 3P. Does this indicate increasing prices increases revenue?

I'm not sure how to go about figuring this out...what should I look for?

Thank you in advance!
 
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moving this request to the homework section
 
chickenlips said:
Hello~

I new here and I'd like a little help please.

Here is the question:
Suppose demand is given by Q = 30 – 3P. Does this indicate increasing prices increases revenue?

I'm not sure how to go about figuring this out...what should I look for?

Thank you in advance!

Revenue is P*Q, so you take P*Q and you tell me if increasing the price will increase revenue.
 

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