The Price Elasticity of Demand for Gasoline Is 0

question 136

Multiple Choice

The price elasticity of demand for gasoline is 0.40. If the price of gasoline rises by 20 percent, there will be

• A) a decrease of more than 20 percent in the quantity of gasoline demanded.
• B) an increase in the total revenue received from the sale of gasoline.
• C) a loss of total revenue for gasoline producers, because at a higher price the quantity of gasoline demanded decreases.
• D) no change in the quantity of gasoline sold because people need gasoline.

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Definitions:

Conversational Inference

The process by which listeners/readers deduce implicit meanings from the context of a conversation or text.

Language Structure

refers to the systematic organization of language, including its sounds, words, and grammar rules, that enables communication and understanding.

Verbal Description

involves conveying information or instructions through spoken or written words.

Predicate

In grammar, a predicate is part of a sentence or clause that tells what the subject is doing or what is being done to the subject; in logic, it refers to the part of a sentence or proposition that asserts something about the subject.