Economists Use the Concept of Price Elasticity of Demand to Measure

question 162

Multiple Choice

Economists use the concept of price elasticity of demand to measure how much:

• A)sellers respond to changes in the price of the good
• B)worse off consumers are when the price of the good rises
• C)demand responds to changes in buyers' incomes
• D)buyers respond to changes in the price of the good

---

Definitions:

Gains

Refers to increases in wealth, income, or resources, often resulting from investment or business operations.

Losses

The negative financial result from an entity's operations, when the total costs exceed total revenues.

Game Theory

A mathematical and analytical framework used to study strategic interactions among rational decision-makers, aiming to predict outcomes in competitive situations.

Nash Equilibrium

A concept in game theory where no player can benefit by changing strategies while the other players keep theirs unchanged.