If a Company Increased Its Price from $100 to $120

question 161

Multiple Choice

If a company increased its price from $100 to $120 and the quantity demanded fell by 40%, the price elasticity of demand for this product is

• A) 2.
• B) 1/2.
• C) −1/2.
• D) −2.
• E) 4.

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Definitions:

Differentiates

To recognize or ascertain the distinctions between two or more things or to make something distinct or specific in character.

Reflective Thinking

The process of carefully considering one’s own experiences and behavior in order to learn and improve.

Dewey

John Dewey was an American philosopher, psychologist, and educational reformer whose ideas have been influential in education and social reform.

Induction

A reasoning process that involves drawing general principles from specific observations or instances.