If the Price of Subway Rides Increases, Quantity Demanded Will

question 60

Multiple Choice

If the price of subway rides increases, quantity demanded will be:

• A) more elastic in six weeks than in six months.
• B) more elastic in six months than in six weeks.
• C) the same over any time period.
• D) unpredictable without more information.

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Definitions:

Price Elasticity of Demand

The rate at which demand for a product responds to its price being altered.

Short Run

The period in economic theory during which at least one factor of production is considered fixed.

Long Run

A period in which all factors of production can be varied, and no inputs are fixed.

Demand Inelasticity

A situation where the demand for a product does not change significantly with a change in its price.