If Demand Price Elasticity Measures 2, This Implies That Consumers

question 155

Multiple Choice

If demand price elasticity measures 2, this implies that consumers would

• A) buy twice as much of the product if the price drops 10 percent.
• B) require a 2 percent drop in price to increase their purchases by 1 percent.
• C) buy 2 percent more of the product in response to a 1 percent drop in price.
• D) require at least a $2 increase in price before showing any response to the price increase.
• E) buy twice as much of the product if the price drops 1 percent.

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Definitions:

Soft Drinks

Non-alcoholic beverages that are usually carbonated and flavored, such as soda or cola.

Dr. John Styth Pemberton

The pharmacist and Confederate States Army veteran who invented Coca-Cola in the late 19th century.

Coca Leaves

The leaves of the coca plant, traditionally used for their stimulant effects in South America, and known for their role in the production of cocaine.

Process

A series of actions or steps taken in order to achieve a particular outcome, often involving stages or phases.