The Less Sensitive Quantity Demanded Is to a Change in Price

question 18

Multiple Choice

The less sensitive quantity demanded is to a change in price, the

• A) smaller a change in price must be to induce a certain change in quantity demanded.
• B) greater the absolute price elasticity of demand.
• C) smaller the absolute price elasticity of demand.
• D) closer the absolute price elasticity of demand is to one.

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Definitions:

Average Total Cost

The total cost of production divided by the number of units produced, including both fixed and variable costs.

Range of Output

Refers to the variety of products or services produced by a company or industry.

Mixers

Devices used to blend or combine ingredients together, often found in kitchens or for industrial purposes.

Average Fixed Cost

The fixed costs of production (costs that do not change with output level) divided by the quantity of output produced.