Editing Price point (section)

==Characteristics==
Introductory [[microeconomics]] depicts a [[demand curve]] as downward-sloping to the right and either linear or gently convex to the origin. The downward slope generally holds, but the model of the curve is only [[piecewise]] true, as price surveys indicate that demand for a product is not a [[linear function]] of its price and not even a [[smooth function]]. Demand curves resemble a series of waves rather than a straight line. <ref>{{Cite web |title=Non Linear Demand Curve Microeconomics Analysis |url=https://priceo.in/non-linear-demand-curve/ |access-date=2022-07-27 |website=Priceo |language=en-US}}</ref>

The diagram shows price points at the points labeled A, B, and C. When a vendor increases a price beyond a price point (say to a price slightly above ''price point B''), sales volume decreases by an amount more than proportional to the price increase. This decrease in quantity demanded more than offsets the additional revenue from the increased unit price. As a result, total revenue (price multiplied by quantity demanded) decreases when a firm raises its price beyond a price point. Technically, the [[price elasticity of demand]] is low (inelastic) at a price lower than the price point (steep section of the demand curve), and  high (elastic) at a price higher than a price point (gently sloping part of the demand curve). [[Business entity|Firm]]s commonly set prices at existing price-points as a [[marketing strategy]].{{Citation needed|date=May 2010}}