Final answer:
Total expenditure rises when there is a price decrease along with an elastic demand, as consumers will purchase proportionately more of the product, leading to an increase in total revenue.
Step-by-step explanation:
Total expenditure, or total revenue, rises when the price elasticity of demand for a product indicates an elastic response to price changes; this is when the percentage decrease in price leads to a larger percentage increase in the quantity demanded, which results in higher total revenue. Option E, there is a price decrease and an elastic demand, accurately depicts this scenario. With elastic demand, if prices decrease, consumers purchase much more of the product, leading to an increase in the total expenditure on the product.
When demand is inelastic as mentioned in option A, a decrease in price will not significantly increase the quantity demanded, and so total expenditure may not rise. Similarly, option D, when elasticity is unit elastic, means that the percentage change in quantity demanded is exactly offset by the percentage change in price, resulting in no change in total expenditure. Option C discusses the lack of substitutes, which might imply an inelastic demand, but does not directly connect this to total expenditure.