If a store raises its prices by 20 percent and its total revenue increases by 10 percent, the demand it faces in this price range must be ainelastic belastic cunit elastic dperfectly elastic eperfectly inelastic

The answer is A: Inelastic.

Here's why:

1. Elasticity of demand refers to how sensitive the quantity demanded of a good is to a change in its price.

2. If demand is elastic, a rise in price would lead to a larger percentage decrease in quantity demanded, resulting in a decrease in total revenue.

3. If demand is inelastic, a rise in price would lead to a smaller percentage decrease in quantity demanded, resulting in an increase in total revenue.

4. In this case, the store raised its prices by 20 percent and its total revenue increased by 10 percent. This means that the percentage decrease in quantity demanded was less than the percentage increase in price.

5. Therefore, the demand it faces in this price range must be inelastic.

The demand the store faces in this price range must be (a) inelastic.

Here's why:

Elasticity of demand measures how responsive quantity demanded is to a change in price. If demand is inelastic, it means that the percentage change in quantity demanded is less than the percentage change in price.

In this case, the store raises its prices by 20 percent and its total revenue increases by 10 percent. This means that the increase in price did not lead to a proportionate decrease in quantity demanded, hence, demand is inelastic.

If demand had been elastic, an increase in price would have led to a larger percentage decrease in quantity demanded, and total revenue would have decreased. If demand had been unit elastic, a percentage change in price would have led to an equal percentage change in quantity demanded, and total revenue would have remained unchanged.

Therefore, the correct answer is (a) inelastic.