The Price Elasticity of Demand for Widgets Is 0

question 236

Multiple Choice

The price elasticity of demand for widgets is 0.8. Assuming no change in the demand curve for widgets, an increase in sales of 16 percent implies a(n)

• A)1 percent reduction in price.
• B)12 percent reduction in price.
• C)20 percent reduction in price.
• D)40 percent reduction in price.

---

Definitions:

International Test

Examinations administered globally to assess academic performance or proficiency in various fields across different nations.

Problem Solving

The process of identifying a problem, generating possible solutions, evaluating and selecting the best option, and implementing it, crucial in decision-making processes.

Practical Cognition

Cognitive processes applied to solving real-world problems, involving reasoning and decision-making in everyday situations.

Spermarche

A boy’s first ejaculation of sperm. Erections can occur as early as infancy, but ejaculation signals sperm production. Spermarche may occur during sleep (in a “wet dream”) or via direct stimulation.