Suppose the elasticity of demand equals -0.5. If a company decreases prices by 10%, quantity demanded will ______ and total revenue will _______.

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Part 1

A.

decrease by 5%; decrease by approximately 5%.

B.

increase by 2.5%; increase by approximately 10%.

C.

increase by 5%; increase by approximately 5%.

D.

increase by 5%; decrease by approximately 5%.