Suppose the Price of a Good Is $10 and Quantity

question 45

Multiple Choice

Suppose the price of a good is $10 and quantity demanded is 50 units. When price increases to $12, quantity demanded decreases to 40 units. What does this indicate?

• A) The quantity effect is larger than the price effect, indicating that demand is inelastic.
• B) The quantity effect is larger than the price effect, indicating that demand is elastic.
• C) The price effect is larger than the quantity effect, indicating that demand is inelastic.
• D) The price effect is larger than the quantity effect, indicating that demand is elastic.

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Definitions:

Behavior Therapist

A mental health professional who uses techniques based on behavioral and cognitive science to treat psychological distress.

Psychoanalyst

A therapist who practices psychoanalysis, a method of psychological therapy that explores the unconscious mind, often focusing on resolving repressed conflicts and issues.

Medical Procedures

Actions conducted by healthcare professionals to diagnose, treat, or prevent health issues in patients.

Psychoanalytic Tradition

A school of psychological thought and therapy founded by Sigmund Freud, emphasizing the influence of unconscious thoughts, feelings, and childhood experiences.