For Product X,the Price Elasticity of Demand Has an Absolute

question 61

Multiple Choice

For product X,the price elasticity of demand has an absolute value of 3.5.This means that quantity demanded will increase by

• A)1 percent for each 3.5 percent decrease in price,ceteris paribus.
• B)1 unit for each $3.50 decrease in price,ceteris paribus.
• C)3.5 percent for each 1 percent decrease in price,ceteris paribus.
• D)3.5 units for each $1 decrease in price,ceteris paribus.

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Definitions:

Objectivity

The quality of being unbiased, unprejudiced, and impartial; dealing with facts without allowing personal feelings to influence them.

Bias

A tendency to lean in a certain direction, either in favor of or against a particular thing, often in a way that is considered to be unfair.

Physical World

The aspect of the universe that is understood through physical phenomena, including matter and energy, as opposed to the abstract or spiritual realm.

Scientific Revolution

A paradigm shift in which a new scientific theory replaces a problematic paradigm.