Answer:
7.8% increase in revenue
Explanation:
Revenue is given by the number of units sold 'n' multiplied by the price of sale 'P'. The revenues before and after the price drop are:
[tex]R_{old} = P*n\\R_{new} = (1-0.02)P*(1+0.1)n=1.078P*n[/tex]
The change in revenue is given by:
[tex]R_{new} = 1.078R_{old}\\\Delta R=1.078-1 = 0.078 = 7.8\%[/tex]
Therefore, there was a 7.8% increase in revenue when price falls by 2%.
