A Value of the Absolute Price Elasticity of Demand Equal

question 412

Multiple Choice

A value of the absolute price elasticity of demand equal to 0.6 indicates that

• A) a 6 percent increase in price leads to a 10 percent decrease in quantity demanded.
• B) a 10 percent increase in price leads to a 6 percent decrease in quantity demanded.
• C) a 0.6 percent increase in price leads to a 1 percent decrease in quantity demanded.
• D) a 1 percent increase in price leads to a 6 percent decrease in quantity demanded.

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