If Quantity Demanded for Rice Falls by 2% When Price

question 23

Multiple Choice

If quantity demanded for rice falls by 2% when price increases 8%,we know that the absolute value of the own-price elasticity of rice is:

• A)2)5.
• B)0)25.
• C)4)
• D)0)40.

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Definitions:

Euros

The official currency of the eurozone, which consists of 19 of the 27 European Union countries.

Risk-Free Rate

The expected return from an investment that carries no risk of financial loss, usually symbolized by government bonds.

Inflation Rate

How quickly the broad level of prices for goods and services climbs, degrading the spending capability.

Initial Cost

The initial outlay or expenditure made to acquire an asset or to start a project.