If a 1 Percent Change in Price Results in a 4

question 115

Multiple Choice

If a 1 percent change in price results in a 4 percent change in quantity demanded, then

• A)the price elasticity of demand is 4.
• B)the slope of the demand curve is 1/4.
• C)the slope of the demand curve is 4.
• D)the price elasticity of demand is 1/4.
• E)there is not enough information to calculate slope or elasticity.

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Definitions:

Human Capital

The collective skills, knowledge, and experience possessed by an individual or population, viewed in terms of their value or cost to an organization or country.

Investment Rates

The percentage of an asset's value that is being invested or the rate at which capital is being used to generate economic activity.

Higher Incomes

Increased earnings of individuals, households, or nations, typically leading to more disposable income and consumption.