Elasticities and Revenues When the price increases, what happens to total revenue? If demand is inelastic, an increase in price increases revenues. In the left panel, an increase in the price from $40 to $50 increases revenues from $4,000 to $4,750, so demand is inelastic. If the demand is elastic, then an increase in price decreases revenues. In the right panel, an increase in price from $40 to $50 decreases revenues from $4,000 to $1,000, so demand is elastic.