A local grocery store raises the price of potatoes by 20%. As a result, the total revenue from potato sales increases. Which category best describes the demand for potatoes in this scenario?

In this scenario, the demand for potatoes can be described as inelastic. This means that even though the store raised the price by 20%, people continued to buy nearly the same amount of potatoes, leading to an increase in total revenue. When demand is inelastic, consumers are not very sensitive to price changes; they still purchase the product because it is a necessary item for many households. For example, if a family needs potatoes for their meals, they will likely buy them even if the price goes up. This behavior shows that the demand for potatoes remains strong despite the increase in price.