Elatic- the percentage change in quantity is greater then the percentage change in price. Point elasticity is only accurate for one small point change. He does not care whether the answer is positive or negative. Elastic- price went down, total revenue went up. Tc=fixed cost+ cost of every unit (variable cost) No monopoly every produces in the inelastic portion of a demand function. They are not subject to the market price increases because they are price setters. Every linear demand function- tr is in the middle. Marginal revenue is zero at the mid point. Point elasticity is not accurate over a range. http://www. google. ca/search? client=safari&rls=en&q=monopoly+producing+in+the+inelastic&ie=u. Percentage change of quantity demand relative to the percentage in income. Cost has no effect on price, what people are willing to pay only affects price. Minimum wage: firms higher less people, they are replaced by higher skilled people. Price goes up, inelastic, total revenue goes up.