If the Price Elasticity of Demand for Smart Watches Is

question 79

Multiple Choice

If the price elasticity of demand for smart watches is 1.4 (dropping the minus sign) , then a 50 percent increase in the price of smart watches will lead to

• A)the sale of 200 additional smart watches.
• B)the sale of 125 percent fewer smart watches than before.
• C)the sale of 70 percent fewer smart watches than before.
• D)the sale of 25 percent fewer smart watches than before.

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Definitions:

Low-cost Electricity

Electricity provided at a lower price, typically achieved through efficient production methods or subsidies.

Economic Competition

A condition in markets where businesses or sellers independently strive for consumer's dollars by offering the best possible terms, leading to efficient resource allocation.

Command Systems

Economic systems where the government controls key sectors of the economy, determining what goods are produced, their prices, and distribution.