If the Price Elasticity of Demand for a Good Is

question 35

Multiple Choice

If the price elasticity of demand for a good is 1.65,then a 3 percent decrease in price results in a

• A)0.55 percent increase in the quantity demanded.
• B)1.82 percent increase in the quantity demanded.
• C)4.95 percent increase in the quantity demanded.
• D)5.55 percent increase in the quantity demanded.

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Definitions:

Production Possibilities Curve

The Production Possibilities Curve (PPC) is a model that shows the various combinations of two goods or services that an economy can produce, given its resources and technology, illustrating the concept of opportunity cost.

Unemployment Rate

The percentage of the labor force unemployed at any time.

Technological Advance

The development and application of innovative processes, equipment, or software that enhances productivity, efficiency, or quality.

Farmers

Individuals or entities engaged in the activity of agriculture, which includes the cultivation of plants and rearing of animals for food, fiber, biofuel, medicines, and other products used to sustain and enhance human life.