If Price Elasticity of Demand Is -0.5

question 123

Multiple Choice

If price elasticity of demand is -0.5,

• A)a 1% decrease in quantity demanded leads to a 0.5% decrease in price
• B)a 1% decrease in price leads to a 0.5% increase in quantity demanded
• C)a 50% decrease in price leads to a 1% increase in quantity demanded
• D)a 50% decrease in price leads to a 100% increase in quantity demanded
• E)demand is elastic

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Definitions:

Average Salaries

The mean amount of payment received by employees in a particular job, industry, or region, calculated by dividing the total sum of salaries by the number of employees.

Employees

Individuals who are hired by a company or organization to perform specific duties in exchange for compensation.

Population Standard Deviations

The square root of the variance of a set of values, which quantifies how much the members of a population differ from the population mean.

Test Statistic

A value calculated from sample data during a hypothesis test. It is used to decide whether to reject the null hypothesis.