Information on the price elasticity of demand is particularly importatn to managerial decision making because:

A) the higher the price elasticity of demand for a product is, the more profitable it will be to produce more of it.
B) depending on the elasticity coefficient, decision makers will immediately know if a price change will cause profits to increase or decrease
C) it allows one to predict how total revenue will respond, i.e., increase or decrease, to a change in price.
D) as the price elasticity coefficient approaches one, profits will increase.

not postive but I think it's a

The correct answer is C) it allows one to predict how total revenue will respond, i.e., increase or decrease, to a change in price.

Price elasticity of demand measures the responsiveness or sensitivity of consumer demand to changes in the price of a product. It is calculated as the percentage change in quantity demanded divided by the percentage change in price. A higher price elasticity of demand indicates a greater responsiveness of consumers to price changes.

Here's why option C is correct:

When the demand for a product is price elastic (elastic demand), a change in price will have a proportionally larger impact on quantity demanded. In this case, if the price of a product is increased, the quantity demanded is expected to decrease by a proportionately larger amount. As a result, total revenue (price multiplied by quantity) will decrease.

Conversely, when the demand for a product is price inelastic (inelastic demand), a change in price will have a proportionally smaller impact on quantity demanded. In this case, if the price of a product is increased, the quantity demanded is expected to decrease by a proportionately smaller amount. As a result, total revenue will increase.

By understanding the price elasticity of demand, decision makers can anticipate how changes in price will affect total revenue. This knowledge is crucial for managerial decision making, as it helps inform pricing strategies, production levels, and profit optimization. It allows decision makers to predict whether increasing or decreasing prices will lead to higher or lower total revenue.