Which of the Following Statements About Price Elasticity of Demand

question 220

Multiple Choice

Which of the following statements about price elasticity of demand is false?

• A)The value of the price elasticity of demand is the reciprocal of the value of the demand curve's slope.
• B)If quantity demanded changes by a larger percentage than the percentage change in price, demand is elastic.
• C)The value of the price elasticity of demand along a downward-sloping demand curve is always negative.
• D)A linear downward-sloping demand curve has a varying price elasticity coefficient.

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Definitions:

Wasted Resources

A form of inefficiency in which people expend money, effort, and time to cope with the shortages caused by a price ceiling.

Surplus

The amount by which the supply of a product exceeds its demand, often leading to lower prices.

Market For Butter

The economic platform where buyers and sellers engage in the exchange of butter, determining its price and quantity available.

Price Floor

A government or group-imposed price control that sets the minimum allowed price above the equilibrium price, potentially leading to surpluses.