Pricing Decision

Hello Sir, hope you are doing good

Sir i was going through the study text of B.P.P for purpose of covering the theoretical area related to the chapter.

I had doubt in the following 2 statements.
(i) In circumstances of inelastic demand, prices should be increased because revenues will increase and total costs will reduce (because quantities sold will reduce).

Doubt –> Sir can you tell me how the Total Cost will reduce, what i thought was that since there is lesser demand there would be a diseconomies of scale and as a result the cost would rise.

(ii) In circumstances of elastic demand, decrease in price will bring increases in revenue. Management therefore have to decide whether the increase in costs will be greater than the increases in revenue.

Doubt –> Sir as the demand would increase, we will increase our production and as a result shouldn’t there be economies of scale and as a result the cost should fall?