The Price Elasticity of Demand for Widgets Is 0

question 333

Multiple Choice

The price elasticity of demand for widgets is 0.75. Assuming no change in the demand curve for widgets, a 9 percent decrease in sales implies a(n)

• A)3.25 percent increase in price.
• B)8 percent increase in price.
• C)12 percent increase in price.
• D)6.75 percent increase in price.

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Definitions:

Alternative Evaluation

The process consumers use to assess the benefits and drawbacks of different products or services before making a purchasing decision.

Information Search

The process consumers undergo to gather facts and opinions about various options before making a purchasing decision.

Problem Recognition

The initial stage of the buying process where a consumer identifies a need or problem that can be satisfied by purchasing a product or service.

Cognitive Dissonance

The mental unease felt by a person when they simultaneously possess conflicting beliefs, ideas, or values.